The rural north-western districts of Bangladesh experience a pre-harvest seasonal famine, locally known as Monga, with disturbing regularity. Roughly 7 percent of the total population in Bangladesh (about 9.6 million people) inhabits these districts and about 5.3 million of those live below the poverty line. The suffering during Monga thus is not limited to a small pocket of households. This is a major failure of public policy in a country that, while desperately poor, has made impressive strides in other aspects of development.
Inspired by the observations that wages are higher, jobs are more plentiful in nearby urban areas than in the Monga-prone region, and that there are no official restrictions on mobility, this study provides monetary incentives in 100 study villages to encourage people to seasonally migrate out in search of employment during the Monga season. We conducted a randomized field experiment where incentives to promote seasonal out-migration of one household member during the Monga period was randomly allocated across households. Our study randomly assigned 1900 households in Lalmonirhat and Kurigram districts to a variety of incentives and conditions for seasonal migration. These 100 villages were randomly allocated to receive different incentives: cash grant (37 villages), credit (31 villages), information/endorsement (16 villages), and control (16 villages). Within each village, we imposed additional conditionalities to random subsets of households (e.g. migrate in a group or to a specific location). The randomization allows us to cleanly estimate the effects of migration on household expenditures, savings, earnings, and caloric intake.
Our findings demonstrate that seasonal out-migration appears to have large causal benefits for Monga-prone households. With the provision of incentives, the migration rate increased from 34% in control villages to 57% in treatment villages receiving the $6 - $8 cash/credit incentive. Total expenditures, food expenditures, and caloric intake increase by 30-35%. Monthly consumption increased by at $15/household. Caloric intake increased by 700 calories per person per day. Migration rate in treatment villages continue to be significantly higher (47% to 35%) even after inducement is removed. Individual migrants are also much more likely to re-migrate.
With such significant positive impacts, it is puzzling why households fail to take advantage of this apparently attractive investment. A few different models could have explained these findings, but the data are most consistent with a rational model in which people are uncertain about their own return to migration, and do not experiment with this concept for fear of a devastating outcome. In this migration poverty trap, even if the chance of failure is low, the potential cost of that failure may be so large (e.g. if it moves the family under the threat of famine below subsistence) that it dominates household decision-making.
Through the provision of a small “incentive to invest” (subsidy conditional on migration), we are able to insure against this kind of bad outcome and encourage migration among those who were otherwise less comfortable migrating. Those in treatment villages, compared to those in control ones, were closer to subsistence are less likely to have social networks, job leads at the destination, and to travel alone. These induced migrants also appear to learn more and are 35-45% more likely to migrate the following year.
