Linkage between emigration and export flows: The case of Bangladesh

Abstract

This paper applies the well-known gravity model to empirically assess the linkage between emigration and export flows of a developing country. Econometric analysis of panel data unveils a significant substituting relationship between export flows from the source country and stock of emigrants to the destination country. This result not only contradicts with existing literature but also justifies manifold relationship between goods and manpower exports. Economic policy as well as foreign policy in Bangladesh must address this inherent relationship between export of goods and labor since emigration of unskilled labor largely depends on bilateral diplomatic relations whereas export patterns depend on comparative cost advantage.