Barriers to Labor Migration for the Rural Poor: Experimental Evidence from a Vocational Training Program in Bangladesh

52 Pages Posted: 12 Jun 2019

See all articles by Abu Shonchoy

Abu Shonchoy

Florida International University (FIU) - Department of Economics

Tomoki Fujii

Singapore Management University - School of Economics

Selim Raihan

University of Dhaka

Date Written: February 11, 2018

Abstract

Vocational training programs aimed at rapidly growing sectors have the potential to reduce skill gaps as well as improve income and employment possibilities. Such programs have often been unsuccessful because they are not driven by industry demand and market linkages. Also, they do not tackle other barriers faced by trainees, such as savings and credit constraints and the uncertainty of migration. We introduced a training "plus'' program for the apparel sector jobs offered to the poor, rural households in northern Bangladesh, where we relaxed some of these constraints in a rigorous Randomized Control Trial (RCT) setting. Analyzing the program uptake demonstrated an interesting heterogeneity, where gender-specific social barriers, as well as risk and time preferences, play influential roles. Data from the follow-up surveys--six and eighteen months after the intervention -- showed a statistically significant, persistent, and a large effect of the training program on employment when combined with an apprenticeship [on-the-job training (OJT)] or stipend component. We also found substantial income and remittance impacts, especially during the time of a seasonal shock, as well as a reduction in income poverty, both for the stipend and OJT groups. However, the rural household estimates -- twelve months after the intervention--showed no impact on consumption poverty in the origin households.

Keywords: Field Experiment, On-the-job Training, Bangladesh, Garment Industry, Rural, Extreme Poor

JEL Classification: J61, O15, R23

Suggested Citation

Shonchoy, Abu and Fujii, Tomoki and Raihan, Selim, Barriers to Labor Migration for the Rural Poor: Experimental Evidence from a Vocational Training Program in Bangladesh (February 11, 2018). Available at SSRN: https://ssrn.com/abstract=3395229 or http://dx.doi.org/10.2139/ssrn.3395229

Abu Shonchoy (Contact Author)

Florida International University (FIU) - Department of Economics ( email )

11200 SW 8th Street
Miami, FL 3199
United States

Tomoki Fujii

Singapore Management University - School of Economics ( email )

90 Stamford Road
178903
Singapore
+6568280279 (Phone)
+6568280833 (Fax)

HOME PAGE: http://www.mysmu.edu/faculty/tfujii/

Selim Raihan

University of Dhaka ( email )

University of Dhaka
Ramna, Dhaka, 1000
Bangladesh

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