Capital Markets, Temporary Migration and Entrepreneurship: Evidence from Bangladesh

Laurent Bossavie, Joseph-Simon Görlach, Çağlar Özden and He Wang

World Development, 2024, vol. 176, issue C

Abstract: This paper examines international temporary migration as an intermediary step among aspiring entrepreneurs to accumulate the needed capital when they face credit constraints at home. The analysis is based on a representative dataset of lifetime employment histories of return migrants from Bangladesh. After establishing the credit constraints that potential entrepreneurs face, the paper shows that non-agricultural self-employment rates are significantly higher among returning migrants — over half versus around 20% of non-migrants. Most migrants transition into self-employment by using their savings from abroad as the main source of financing. The paper then offers, for the first time, a detailed account of the financial costs and benefits of international migration. Our findings suggest that temporary migration can contribute to structural transformation of lower-income countries by enabling credit-constrained workers to enter into non-agricultural entrepreneurship.

Keywords: Temporary migration; Credit constraints; Risky investment; Entrepreneurship (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Capital Markets, Temporary Migration and Entrepreneurship: Evidence from Bangladesh (2023)
Working Paper: Capital Markets, Temporary Migration and Entrepreneurship: Evidence from Bangladesh (2023)
Working Paper: Capital Markets, Temporary Migration and Entrepreneurship: Evidence from Bangladesh (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:176:y:2024:i:c:s0305750x23003236

DOI: 10.1016/j.worlddev.2023.106505

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