Poverty and Migration in the Digital Age: Experimental Evidence on Mobile Banking in Bangladesh

Jean N. Lee, Jonathan Morduch, Saravana Ravindran, Abu Shonchoy and Hassan Zaman

American Economic Journal: Applied Economics, 2021, vol. 13, issue 1, 38-71

Abstract: Rapid urbanization is reshaping economies and intensifying spatial inequalities. In Bangladesh, we experimentally introduced mobile banking to very poor rural households and family members who had migrated to the city, testing whether mobile technology can reduce inequality by modernizing traditional ways to transfer money. One year later, for active mobile banking users, urban-to-rural remittances increased by 26 percent of the baseline mean. Rural consumption increased by 7.5 percent, and extreme poverty fell. Rural households borrowed less, saved more, sent additional migrants, and consumed more in the lean season. Urban migrants experienced less poverty and saved more but bore costs, reporting worse health.

JEL-codes: D31 G21 G51 I32 O15 O16 O18 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (59)

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DOI: 10.1257/app.20190067

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