Out of Sight, Out of Mind: Migration, Entrepreneurship and Social Capital

Reprint No. 2012:41

Author(s): Jackline Wahba and Yves ZenouYear: 2012 Title: Regional Science and Urban Economics Volume (No.): 42 (5) Pages: 890–903
Online article (restrictions may apply)

The aim of this paper is to investigate whether return migrants are more likely to become entrepreneurs than non-migrants. We develop a theoretical search model that puts forward the trade off faced by returnees since overseas migration provides an opportunity for human and physical capital accumulation but, at the same time, may lead to a loss of social capital back home. We test the predictions of the model using data from Egypt. We find that, even after controlling for the endogeneity of the temporary migration decision, an overseas returnee is more likely to become an entrepreneur than a non-migrant. Although migrants may lose their social capital, they accumulate savings and experience overseas that increase their chances of becoming entrepreneurs.

Wahba, Jackline and Yves Zenou (2012), "Out of Sight, Out of Mind: Migration, Entrepreneurship and Social Capital". Regional Science and Urban Economics 42(5), 890–903.

Sick of Inequality?

An Introduction to the Relationship between Inequality and Health

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In this book Andreas Bergh, Therese Nilsson, IFN and Lund University, and Daniel Waldenström, IFN and Paris School of Economics, France, review the latest research on the relationship between inequality and health. What does inequality mean for our health? Does increasing income inequality affect outcomes such as obesity, life expectancy and subjective well-being?


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