This paper provides an additional channel through which inequality may influence growth, when labor migration is taken into account. In fact, we show that human capital distribution is crucial to determine whether allowing migration of the most skilled workers from a developing country may be beneficial for growth, from the perspective of the source economy. The net linked to a brain drain is more likely to be negative in the short run if human capital is very unequally distributed. In addition, we find that econometric analysis supports our theoretical claims : the estimation of different growth equations in a cross-section of developing countries, based on a brand new datset on skilled migration (Docquier and Marfouk, 2004) shows that a brain drain can have a positive impact only when it is associated with low inequality (in income or schooling).
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Find related papers by 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 J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers I20 - Health, Education, and Welfare - - Education - - - General
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