Paper Title
Are Households with Returnee Migrants More Likely to be Entrepreneurial than Households with non-Migrants? A Study from Household Survey in Nepal

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.