Remittances and Non-Farm Self-Employment among the Left-Behind: Evidence from Nepal

Paras Kharel Author-Name: Kshitiz Dahal Author-Name: Jorge Davalos
Authors registered in the RePEc Author Service: Jorge E. Davalos and Paras Kharel

Working Papers PMMA from PEP-PMMA

Abstract: We estimated the impact of remittances from international migration on the labor supply of left-behind household members to non-farm self-employment and on the performance of the non-farm enterprises they operated. We used data from a nationally representative household survey from Nepal that included an enterprise module. We accounted for both the truncated nature of observed hours worked and the endogeneity of remittances when assessing the impact on labor supply, and, in estimating the effects on firm performance, we addressed selection into operating a non-farm enterprise as well as the endogeneity of remittances. Remittances were found to encourage women to reduce their labor supply in non-farm self-employment, whereas there was no significant effect on men. We found evidence that the disincentive effect was strong enough to exert a negative influence on the revenues of non-farm enterprises operated by the left-behind labor force.

Keywords: Remittances; Migration; Labour supply; Microenterprises; Entrepreneurship (search for similar items in EconPapers)
JEL-codes: F22 J22 L20 O20 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-dev, nep-ent and nep-mig
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:lvl:pmmacr:2020-06

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