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FDI, the Brain Drain and Trade: Channels and Evidence

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  • Artjoms Ivlevs

    (University of Nottingham)

  • Jaime de Melo

    (University of Geneva, CERDI and CEPR)

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 103 migration-sending countries over the period 1990-2000 finds some support for this conjecture.

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Bibliographic Info

Paper provided by Centro Studi Luca d\'Agliano, University of Milano in its series Development Working Papers with number 261.

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Length: 32
Date of creation: 27 Oct 2008
Date of revision:
Handle: RePEc:csl:devewp:261

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Keywords: Migration; FDI; Brain Drain;

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Citations

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Cited by:
  1. Schiff, Maurice, 2010. "Small State Regional Cooperation, South-South and South-North Migration, and International Trade," IZA Discussion Papers 4938, Institute for the Study of Labor (IZA).
  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. 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, University of Economics, Prague, vol. 2011(4), pages 85-100.
  4. Di Maria, Corrado & Lazarova, Emiliya A., 2012. "Migration, Human Capital Formation, and Growth: An Empirical Investigation," World Development, Elsevier, Elsevier, vol. 40(5), pages 938-955.

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