On 19 September 2024, we were delighted to welcome Prof. Mushfiq Mobarak from Yale University.
As part of our lecture series on Cross-Border Labour Mobility, Prof. Mobarak delivered an insightful lecture on “Seasonal Poverty, Seasonal Migration, and Remittances.”
The talk outlined a research agenda and open questions around the causes and consequences of internal, within-country migration, as well as the opportunities and impediments associated with such movements. Much of that movement in seasonal and circular, in response to seasonal deprivation during pre-harvest lean periods. We introduced the topic of internal migration as an example of a “technology” with the potential to improve welfare but is adopted at low rates, similar to many other productive, profitable technologies.
Prof. Mobarak discussed both direct and indirect general equilibrium effects of migration. We ended with a discussion of external validity by pivoting to discussing the details of a research paper titled “Remittance Constraints and Seasonal Poverty.” Rural households send migrants to mitigate seasonal deprivation, but remittances don’t always arrive in time. We observe a counter-intuitive pattern in Nepal where remittances are low when rural residents are food insecure, and migrants return with remittances later during harvest. To overcome this apparent remittance constraint indirectly, we provide a $90 loan to randomly-selected rural households during the pre-harvest lean season. Harvest period remittances increase in loan-recipient households, and 89% of the loan principal is repaid. Food security improves, and those households increase fertilizer use and own-farm labor. That increases their rice harvest, revenues, and subjective well-being. In a two-period model of household decision-making, we show that remittance frictions are necessary to qualitatively match our experimental results.
This lecture series is organised by Luxembourg Institute of Socio-Economic Research (LISER) & the Doctoral School in Economics, Finance and Management from the University of Luxembourg, in the framework of the Fonds National de la Recherche (FNR), Luxembourg funded project: ACROSS.
The next lecture series will feature Prof. Jackline Wahba from the University of Southampton.
An event supported by the Luxembourg National Research Fund (FNR) (PRIDE19/14302992) and (RESCOM/2024/LE/18786706)