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Brain drain in globalization: A general equilibrium analysis from the sending countries? perspective

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  • Docquier, Frédéric
  • Marchiori, Luca
  • Shen, I-Ling

Abstract

High-skilled emigration has been found to affect developing economies via different channels. With a calibrated general equilibrium framework, this paper finds that the short-run impact of brain drain on resident human capital is extremely crucial, as it does not only determine the number of high-skilled workers available to domestic production, but it affects the sending economy?s capacity to innovate/adopt modern technologies. The latter impact is particularly important in globalization, where capital investments are made in places with higher production efficiencies. Hence, despite the positive feedback effects, those countries facing prevalent high-skilled emigration are the most candid victims to brain drain.

Suggested Citation

  • Docquier, Frédéric & Marchiori, Luca & Shen, I-Ling, 2010. "Brain drain in globalization: A general equilibrium analysis from the sending countries? perspective," CEPR Discussion Papers 7682, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:7682
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    2. Nejad, Maryam Naghsh & Young, Andrew T., 2016. "Want freedom, will travel: Emigrant self-selection according to institutional quality," European Journal of Political Economy, Elsevier, vol. 45(S), pages 71-84.
    3. Bennett, Daniel & Nikolaev, Boris & Aidt, Toke, 2016. "Institutions & Well-being," MPRA Paper 78436, University Library of Munich, Germany.
    4. Vladimir Borgy & Xavier Chojnicki & Gilles Le Garrec & Cyrille Schwellnus, 2010. "Macroeconomic Consequences of Global Endogenous Migration: a General Equilibrium Analysis," Annals of Economics and Statistics, GENES, issue 97-98, pages 13-39.
    5. Harald Fadinger & Karin Mayr, 2014. "Skill-Biased Technological Change, Unemployment, And Brain Drain," Journal of the European Economic Association, European Economic Association, vol. 12(2), pages 397-431, April.
    6. Elisabetta Lodigiani & Luca Marchiori & I-Ling Shen, 2016. "Revisiting the Brain Drain Literature with Insights from a Dynamic General Equilibrium World Model," The World Economy, Wiley Blackwell, vol. 39(4), pages 557-573, April.
    7. Kouni, Mohamed, 2016. "Medical Brain Drain and Life Expectancy: A Comparative Analysis between Arab, American and Asian Countries," MPRA Paper 78321, University Library of Munich, Germany.
    8. Dustmann, Christian & Glitz, Albrecht, 2011. "Migration and Education," Handbook of the Economics of Education, in: Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), Handbook of the Economics of Education, edition 1, volume 4, chapter 0, pages 327-439, Elsevier.
    9. Leite, Duarte N. & Afonso, Óscar & Silva, Sandra T., 2019. "A tale of two countries: Directed technical change, trade and migratory movements," Economic Modelling, Elsevier, vol. 83(C), pages 173-194.
    10. Arends-Kuenning, Mary P. & Calara, Alvaro & Go, Stella, 2015. "International Migration Opportunities and Occupational Choice: A Case Study of Philippine Nurses 2002 to 2014," IZA Discussion Papers 8881, Institute of Labor Economics (IZA).
    11. Sharma, Hari, 2020. "The effect of emigration and remittances on labour supply of the left-behind: Evidence from Nepal," MPRA Paper 102091, University Library of Munich, Germany.
    12. Iryna Shopina & Olena Oliinyk & Valerii Finaheiev, 2017. "Globalization And Its Negative Impact On The Global Economy," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 3(5).
    13. Vikhrov Dmytro, 2013. "Welfare Effects of Labor Migration," CERGE-EI Working Papers wp491, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    14. Harald Fadinger & Karin Mayr, 2014. "Skill-Biased Technological Change, Unemployment, And Brain Drain," Journal of the European Economic Association, European Economic Association, vol. 12(2), pages 397-431, April.
    15. Duarte Leite & Óscar Afonso & Sandra Silva, 2014. "A tale of two countries: a directed technical change approach," FEP Working Papers 539, Universidade do Porto, Faculdade de Economia do Porto.
    16. Zhang, Yi & Matz, Julia Anna, 2017. "On the train to brain gain in rural China," Discussion Papers 252443, University of Bonn, Center for Development Research (ZEF).
    17. Andrea Caragliu & Peter Nijkamp, 2013. "From Islands to Hubs of Innovation: Connecting Innovative Regions," Tinbergen Institute Discussion Papers 13-141/VIII, Tinbergen Institute.
    18. George-Laurentiu Serban-Oprescu & Liana Badea & Isabel Novo-Corti & Mihaela Roberta Stanef & Silvia Elena Iacob & Grigore Ioan Pirosca, 2021. "Socio-Psychological Dimensions of Students Migration. A Pilot Study," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 23(Special15), pages 1015-1015, November.
    19. Ted Davis & David M. Hart, 2010. "International Cooperation to Manage High‐Skill Migration: The Case of India–U.S. Relations," Review of Policy Research, Policy Studies Organization, vol. 27(4), pages 509-526, July.
    20. Docquier, Frédéric & Marchiori, Luca, 2012. "The impact of MENA-to-EU migration in the context of demographic change," Journal of Pension Economics and Finance, Cambridge University Press, vol. 11(2), pages 243-284, April.
    21. Anthony Orji & Chukwuma Agu, 2018. "Analysis of Migration, Regional Characteristics, and Socioeconomic Outcomes in Developing Economies: Empirical Evidence from Nigeria," Journal of International Migration and Integration, Springer, vol. 19(3), pages 565-581, August.
    22. Ratha, Dilip & Mohapatra, Sanket & Scheja, Elina, 2011. "Impact of migration on economic and social development : a review of evidence and emerging issues," Policy Research Working Paper Series 5558, The World Bank.
    23. Okoye, Dozie, 2016. "Can brain drain be good for human capital growth? Evidence from cross-country skill premiums and education costs," Economic Analysis and Policy, Elsevier, vol. 49(C), pages 74-99.

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    More about this item

    Keywords

    Brain drain; Capital flow; Development; Human capital;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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