Internal migration and youth entrepreneurship in the Democratic Republic of the Congo

• Author: Alain Kikandi Kiuma,Christian Kamala Kaghoma,Abdelkrim Araar
• Date: 01 August 2020
• DOI: http://doi.org/10.1111/rode.12669
• Published date: 01 August 2020

790

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wileyonlinelibrary.com/journal/rode Rev Dev Econ. 2020;24:790–814.

© 2020 John Wiley & Sons Ltd

Received: 16 October 2018

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Revised: 1 April 2020

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Accepted: 2 April 2020

DOI: 10.1111/rode.12669

SPECIAL SYMPOSIUM: PROMOTING YOUTH AND FEMALE

ENTREPRENEURSHIP IN DEVELOPING COUNTRIES

Internal migration and youth entrepreneurship in

the Democratic Republic of the Congo

Alain KikandiKiuma1

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AbdelkrimAraar2

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Christian KamalaKaghoma3

1Department of Economics, Université

Libre des Pays des Grands-Lacs (ULPGL),

Center for Research in Social Science and

Public Policy (CReSP2-DRC)

2PEP and CIRPÉE, University of Laval,

Laval, Canada

3Department of Economics, Université

Catholique de Bukavu (UCB), Université

Officielle de Bukavu (UOB) and CReSP2-

DRC

Correspondence

Christian Kamala Kaghoma, Department

of Economics, Université Catholique de

Bukavu (UCB), Université Officielle de

Bukavu (UOB) and CReSP2-DRC.

Emails: chriskkaghoma@yahoo.fr, kamala.

kaghoma@ucbukavu.ac.cd

Abstract

This paper analyzes youth internal migration in the

Democratic Republic of the Congo (DRC) and its impact

on entrepreneurship startup in a fresh post-conflict context.

Building on a national representative survey conducted in

2005, a recursive bivariate probit specification is used to

jointly estimate the decision models of both migration and

entrepreneurship. To evaluate the robustness of results, the

propensity score matching method is used to test the con-

cordance of the results after eliminating the redundant im-

pact of unobserved factors. The two main conclusions are

that youth migration increases the probability of being an

entrepreneur, but in the informal sector. In addition, like

secondary and post-secondary education, the duration of

stay after migrating is an important factor to being an en-

trepreneur in the formal sector. These conclusions are ex-

pected to enlighten policy-makers as to the importance of

promoting secondary and post-secondary education as well

as inclusive growth investments that may absorb more youth

labor in formal sectors. This is the first exercise in the case

of the DRC and since it focuses on youth, the paper makes

a unique contribution to the literature related to the link be-

tween migration and entrepreneurship in a post-war context.

1

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INTRODUCTION

The phenomenon of migration is at the center of preoccupations of economic policy-makers and

academics. This is primarily due to the importance of migration flows between countries and the

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concerns of local populations with regard to their implications, in particular for employment opportu-

nities (Friedberg and Hunt, 1995). Yet, compared to internal migration, international mobility remains

very limited: while international migration is expanding, greater internal mobility also continues to

be observed, although the latter has not drawn as much attention as the former type of migration in

the academic literature, probably due to the lack of related statistical data (Skeldon, 2009; Bao etal.,

2007; Castaing Gachassin, 2013; Berker, 2011). Interest in internal migration has grown due to its

intensity and its influence on the individual situation of migrants and, beyond labor market issues, on

that of their families (White, 2009; Ackah and Medvedev, 2012; Mberu, 2005; Mitra, 2010; Knight

and Gunatilaka, 2010; Switek, 2016; Dheer, 2018). In spite of this new orientation, there has been

very little emphasis in the literature on the link between internal migration and the decision to engage

in entrepreneurial activity. Most studies of internal migration rather focus on its main determinants,

and how it affects migrants’ income. Of course, they relate the decision to migrate with the labor mar-

ket outcomes and thus attribute a central role to employment and wage opportunities, following a line

of research proposed by Hicks (1932) which considers net economic advantages as the main drivers

of migration. However, with the exception of some studies on international migration such as Bertoli

and Ruyssen (2018), very little research dealing with internal migration takes into account business

opportunities among the economic advantages mentioned by Hicks which may attract migrants to

different destinations. As such, they sidestep the possibility of linking internal migration with entre-

preneurship which in the particular context of developing countries has revealed its virtue as a source

of job creation (see, for instance, African Development Bank, 2012; Falco and Haywood, 2016, for

illustrations in the case of Africa).

One of the major problems facing most African countries is the inability of their economies to re-

duce unemployment, particularly that of youth1

(Fox etal., 2016; Gough and Langevang, 2016). For a

continent where two thirds of the population is under 30 years of age, the consequences of such a situ-

ation can be enormous to the point of weighing against the momentum of growth it has displayed over

the last decade.2

In such a context, youth entrepreneurship is found to be an effective way to absorb

the unused productive forces of the economy. While, for the vast majority, activities started by youth

are primarily in the informal sector, they contribute to employment creation and economic growth.

This is the general situation with regard to unemployment and its concentration among youth

across the continent, and the Democratic Republic of Congo (DRC), one of the poorest countries on

the planet, is no exception. According to the Central Bank of Congo (2010), gross domestic product

(GDP) per capita rose from US$79.3 in 2002 to $91.0 in 2006 and then to $100.5 in 2010. Despite the

gap between the increase in the average real GDP and demographic growth, respectively estimated at

5.6% and 3.1% over 2006–2010, poverty still affects seven out of 10 households (Ministry of Planning

of DRC, 2012), and unemployment lie around 59%, with less than 100 of the 9,000 youth leaving

Congolese universities each year being able to find a job. According to the African Development Bank

(2012), the number of job seekers continued to increase in 2013 in the face of the current difficulties,

and the Congolese government is not in a position to provide employment for current or future unem-

ployed, in spite of the forecast made by the Ministry of Planning in the framework of SPGPR2 and

targeting the creation of 1 million jobs per year as of 2012. While globally affected by the situation

described above, the DRC is comprised of provinces with very different situations in terms of resource

endowment; some are better endowed than others. These differences in productive assets also lead to

differences in business opportunities and productive capacity. This disparity results in differences in

provincial GDP as reported in Table 1.3

According to the Institut National de la Statistique (2005) and

the International Organization for Migration (2009), these disparities between provinces in terms of

wealth and opportunities (employment and business) model the outcomes of populations which, in

order to seize rare employment or business opportunities, adopt migratory behavior.