Self-employment and migration

There is a widespread policy view that a lack of job opportunities at home is a key reason for migration, accompanied by suggestions of the need to spend more on creating these opportunities so as to reduce migration. Self-employment is widespread in poor countries, and faced with a lack of existing jobs, providing more opportunities for people to start businesses is a key policy option. But empirical evidence to support this idea is slight, and economic theory offers several reasons why the self-employed may in fact be more likely to migrate. We put together panel surveys from eight countries to descriptively examine the relationship between migration and self-employment, finding that the self-employed are indeed less likely to migrate than either wage workers or the unemployed. We then analyze seven randomized experiments that increased self-employment. The causal impacts of these programs on migration are often small in magnitude, and a negative relationship is only found when looking over time horizons of at least two years post-treatment. (C) 2020 The International Bank for Reconstruction and Development. Published by Elsevier Ltd. All rights reserved.