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Modelling the Flow of Knowledge and Human Capital: A Framework of Innovative Capital

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  • d'Artis Kancs
  • Pavel Ciaian

Abstract

Recently, the EU Council adopted a new labour migration policy instrument - the EU Blue Cards (BC) - for attracting the highly skilled workers to the EU. The present paper examines the potential impacts, which BC may cause on less developed sending countries (LDC). Our results suggest that the EU BC will reduce human capital in LDC. In addition, BC will also have a negative impact on knowledge capital. These findings suggest that without appropriate policy responses, BC makes developing country growth prospects rather bleak than blue. Therefore, we propose and analyse alternative migration policy instruments for LDC. We find that policies implemented on the demand side of the skilled labour market are the most efficient. In contrast, policies that address the supply side of the skilled labour market are the least efficient, though they might be less costly to implement.

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Bibliographic Info

Paper provided by Economics and Econometrics Research Institute (EERI), Brussels in its series EERI Research Paper Series with number EERI_RP_2011_21.

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Date of creation: 12 Dec 2011
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Handle: RePEc:eei:rpaper:eeri_rp_2011_21

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Keywords: Knowledge capital; human capital; high-skill migration; innovative capital; economic growth.;

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Cited by:
  1. d'Artis Kancs & Boriss Siliverstovs, 2012. "R&D and Non-linear Productivity Growth of Heterogeneous Firms," LICOS Discussion Papers, LICOS - Centre for Institutions and Economic Performance, KU Leuven 32112, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  2. d'Artis Kancs & Julda Kielyte, 2010. "Education in the East, Emigrating to the West?," EERI Research Paper Series, Economics and Econometrics Research Institute (EERI), Brussels EERI_RP_2010_01, Economics and Econometrics Research Institute (EERI), Brussels.

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