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The Economic Consequences of ‘Brain Drain’ of the Best and Brightest: Microeconomic Evidence from Five Countries

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  • John Gibson
  • David McKenzie

Abstract

Brain drain has long been a common concern for migrant-sending countries, particularly for small countries where high-skilled emigration rates are highest. However, while economic theory suggests a number of possible benefits, in addition to costs, from skilled emigration, the evidence base on many of these is very limited. Moreover, the lessons from case studies of benefits to China and India from skilled emigration may not be relevant to much smaller countries. This paper presents the results of innovative surveys which tracked academic high-achievers from five countries to wherever they moved in the world in order to directly measure at the micro level the channels through which high-skilled emigration affects the sending country. The results show that there are very high levels of emigration and of return migration among the very highly skilled; the income gains to the best and brightest from migrating are very large, and an order of magnitude or more greater than any other effect; there are large benefits from migration in terms of postgraduate education; most high-skilled migrants from poorer countries send remittances; but that involvement in trade and foreign direct investment is a rare occurrence. There is considerable knowledge flow from both current and return migrants about job and study opportunities abroad, but little net knowledge sharing from current migrants to home country governments or businesses. Finally, the fiscal costs vary considerably across countries, and depend on the extent to which governments rely on progressive income taxation.

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Bibliographic Info

Article provided by Royal Economic Society in its journal The Economic Journal.

Volume (Year): 122 (2012)
Issue (Month): 560 (05)
Pages: 339-375

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Handle: RePEc:ecj:econjl:v:122:y:2012:i:560:p:339-375

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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. The Economic Consequences of â??Brain Drainâ?
    by Ariel Goldring in Free Market Mojo on 2010-09-05 12:16:06
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Cited by:
  1. Yaw Nyarko, 2014. "The Returns to the Brain Drain and Brain Circulation in Sub-Saharan Africa: Some Computations Using Data from Ghana," NBER Chapters, in: African Successes: Human Capital National Bureau of Economic Research, Inc.
  2. John Gibson & David McKenzie, 2013. "Scientific Mobility and Knowledge Networks in High Emigration Countries: Evidence from the Pacific," CReAM Discussion Paper Series 1305, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  3. Simon Commander & Olexandr Nikolaychuk & Dmytro Vikhrov, 2013. "Migration from Ukraine: Brawn or Brain? New Survey Evidence," Working Papers 156, European Bank for Reconstruction and Development, Office of the Chief Economist.
  4. Berlinschi, Ruxanda & Schokkaert, Jeroen & Swinnen, Johan, 2013. "When drains and gains coincide: Migration and international football performance," Labour Economics, Elsevier, vol. 21(C), pages 1-14.
  5. Michael Clemens and David McKenzie, 2014. "Why Don't Remittances Appear to Affect Growth? - Working Paper 366," Working Papers 366, Center for Global Development.
  6. John Gibson & David McKenzie, 2011. "Eight Questions about Brain Drain," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 107-28, Summer.
  7. Sona Schovankova, 2013. "Determinants of the Spatial Distribution of Foreign Empolyees on Different Skilled Positions: The Case of the Czech Republic," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 2, pages 115-139, June.
  8. Ernest Miguélez, 2014. "Inventor Diasporas and the Internalionalization of Technology," CReAM Discussion Paper Series 1425, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  9. Jean-Pascal Bénassy & Elise S. Brézis, 2012. "Brain Drain and Development Traps," Working Papers 2012-03, Department of Economics, Bar-Ilan University.
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