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Return Migration as Channel of Brain Gain

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Author Info
Karin Mayr () (Johannes Kepler University, Linz)
Giovanni Peri () (UC Davis and NBER)

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Abstract

Recent theoretical and empirical studies have emphasized the fact that the prospect of international migration increases the expected returns to skills in poor countries, linking the possibility of migrating (brain drain) with incentives to higher education (brain gain). If emigration is uncertain and some of the highly educated remain, such a channel may, at least in part, counterbalance the negative effects of brain drain. Moreover, recent empirical evidence seems to show that temporary migration is widespread among highly skilled migrants (such as Eastern Europeans inWestern Europe and Asians in the U.S.). This paper develops a simple tractable overlapping generations model that provides an economic rationale for return migration and which predicts who will migrate and who will return among agents with heterogeneous abilities. We use parameter values from the literature and the data on return migration to calibrate our model and simulate and quantify the effects of increased openness on human capital and wages of the sending countries. We find that, for plausible values of the parameters, the return migration channel is very important and combined with the incentive channel reverses the brain drain into significant brain gain for the sending country.

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Publisher Info
Paper provided by Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London in its series CReAM Discussion Paper Series with number 00804.

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Date of creation: Apr 2008
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Handle: RePEc:crm:wpaper:0804

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Related research
Keywords: Skilled Migration Return Migration Returns to Education.

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Find related papers by JEL classification:
F22 - International Economics - - International Factor Movements and International Business - - - International Migration
J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers
O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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  2. Sebastian Gundel & Heiko Peters, 2008. "What Determines the Duration of Stay of Immigrants in Germany? : Evidence from a Longitudinal Duration Analysis," SOEPpapers 79, DIW Berlin, The German Socio-Economic Panel (SOEP). [Downloadable!]
  3. Michel, BEINE & Frédéric, DOCQUIER & Hillel, RAPOPORT, 2006. "Brain drain and human capital formation in developing countries : winners and losers," Université catholique de Louvain, Département des Sciences Economiques Working Paper 2006023, Université catholique de Louvain, Département des Sciences Economiques. [Downloadable!]
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  4. Francesco Caselli & Wilbur John Coleman, 2006. "The World Technology Frontier," American Economic Review, American Economic Association, vol. 96(3), pages 499-522, June.
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  5. Bhagwati, Jagdish & Hamada, Koichi, 1974. "The brain drain, international integration of markets for professionals and unemployment : A theoretical analysis," Journal of Development Economics, Elsevier, vol. 1(1), pages 19-42, April. [Downloadable!] (restricted)
  6. Antonio Ciccone & Giovanni Peri, 2006. "Identifying Human-Capital Externalities: Theory with Applications," Review of Economic Studies, Blackwell Publishing, vol. 73(2), pages 381-412, 04. [Downloadable!] (restricted)
  7. Lynne G. Zucker & Michael R. Darby, 2007. "Star Scientists, Innovation and Regional and National Immigration," NBER Working Papers 13547, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  8. Christian Dustmann & Yoram Weiss, 2007. "Return Migration: Theory and Empirical Evidence from the UK," British Journal of Industrial Relations, Blackwell Publishers Ltd/London School of Economics, vol. 45(2), pages 236-256, 06. [Downloadable!] (restricted)
  9. Lucas, Robert E B & Stark, Oded, 1985. "Motivations to Remit: Evidence from Botswana," Journal of Political Economy, University of Chicago Press, vol. 93(5), pages 901-18, October. [Downloadable!] (restricted)
  10. Dustmann, Christian & Kirchkamp, Oliver, 2002. "The optimal migration duration and activity choice after re-migration," Journal of Development Economics, Elsevier, vol. 67(2), pages 351-372, April. [Downloadable!] (restricted)
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  11. Acemoglu, Daron, 2002. "Directed Technical Change," Review of Economic Studies, Blackwell Publishing, vol. 69(4), pages 781-809, October.
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