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FDI, the Brain Drain and Trade: Channels and Evidence

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  • Artjoms IVLEVS
  • Jaime DE MELO

Abstract

This paper explores the links between the patterns of migration (high vs. low-skill), trade policy, and foreign direct investment (FDI) from the standpoint of sending countries. A skeleton general equilibrium model with a non-traded good and sector-specific labour is used to explore the effects of the skill-composition of exports on FDI. The model suggests that if exports are low-skill intensive, emigration of high-skill labour leads to positive FDI, suggesting that migration and FDI are complements. Cross-sectional analysis using FDI and emigration data for 102 migration-sending countries over the period 1990-2000 finds some support for this conjecture

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Bibliographic Info

Article provided by ENSAE in its journal Annals of Economics and Statistics.

Volume (Year): (2010)
Issue (Month): 97-98 ()
Pages: 103-121

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Handle: RePEc:adr:anecst:y:2010:i:97-98:p:05

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Cited by:
  1. Schiff, Maurice, 2010. "Small state regional cooperation, south-south and south-north migration, and international trade," Policy Research Working Paper Series 5297, The World Bank.
  2. Luca Marchiori & I-Ling Shen & Frédéric Docquier, 2013. "Brain Drain In Globalization: A General Equilibrium Analysis From The Sending Countries' Perspective," Economic Inquiry, Western Economic Association International, vol. 51(2), pages 1582-1602, 04.
  3. Di Maria, Corrado & Lazarova, Emiliya A., 2012. "Migration, Human Capital Formation, and Growth: An Empirical Investigation," World Development, Elsevier, vol. 40(5), pages 938-955.
  4. David Procházka & Cristina Procházková Ilinitchi, 2011. "The Theoretical Relationships among Foreign Direct Investments, Migration and IFRS Adoption," European Financial and Accounting Journal, University of Economics, Prague, vol. 2011(4), pages 85-100.

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