Back to top
Authors
Dr. Dhruba Bhandari
Dr. Bishnu Dev Pant
Published Year
2019
Research Type
Journal Articles

Are households with returnee migrants more entrepreneurial relative to household with non-migrants? We explore
this question using household survey data from 31 districts in Nepal. Overall effect of returnee migrants on household’s
business ownership/entrepreneurship depends on result of two opposing forces at work: on one hand returnee migrants can
bring savings, experience and skills needed to set up business, however there is loss of social capital (personal networks)
when they are out of the country. Estimating this causal effect is challenging because self-selection of household into
outward migration at initial stage and into return migration at final stage. We address self-selection of initial outward
migration using instrumental variable approach and address the self-selection at return stage by exploiting the circumstances
forced return migration to Nepal due to expiration of work permit/work contract and health reasons. We examine the impact
of having returnee migrants on household owning business (general) and agri-business (farming and live-stock).Our result
shows that having a returnee migrant increases the probability of household owning agribusiness by 0.16. On the other hand,
having a returnee migrant on household decreases the probability of owning general businesses by 0.24.