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Extending the case for a beneficial brain drain

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Abstract

The recent literature about the so called brain drain assumes that destination countries are characterized not only by higher wages than the source country, but also by a higher or at least not lower relative return to skill. As this assumption has a doubtful empirical validity, we assess whether the main prediction of this literature, namely the possibility of a beneficial brain gain, still holds under the reverse assumption. We show that there is still a case for a beneficial brain drain. Immigration policies that are biased against unskilled workers are not necessary for a beneficial brain drain to occur once one considers that agents face heterogeneous migration costs.

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Paper provided by Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa in its series Working Papers - Economics with number wp2008_14.rdf.

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Length: 12 pag
Date of creation: 2008
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Handle: RePEc:frz:wpaper:wp2008_14.rdf

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Keywords: migration; brain drain; skill premium; heterogeneous agents; selective immigration policies;

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  1. Michel Beine & Frédéric Docquier & Caglar Özden, 2009. "Diasporas," CESifo Working Paper Series 2607, CESifo Group Munich.
  2. Borjas, George J, 1987. "Self-Selection and the Earnings of Immigrants," American Economic Review, American Economic Association, vol. 77(4), pages 531-53, September.
  3. Docquier, Frédéric & Rapoport, Hillel, 2007. "Skilled Migration: The Perspective of Developing Countries," IZA Discussion Papers 2873, Institute for the Study of Labor (IZA).
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  8. Stark, Oded & Wang, Yong, 2001. "Inducing Human Capital Formation: Migration as a Substitute for Subsidies," Economics Series 100, Institute for Advanced Studies.
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  12. Michel Beine & Frédéric Docquier & Hillel Rapoport, 2001. "Brain drain and economic growth: theory and evidence," ULB Institutional Repository 2013/10449, ULB -- Universite Libre de Bruxelles.
  13. Michèle V. K. Belot & Timothy J. Hatton, 2012. "Immigrant Selection in the OECD," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(4), pages 1105-1128, December.
  14. Karin Mayr & Giovanni Peri, 2009. "Brain Drain and Brain Return: Theory and Application to Eastern-Western Europe," NRN working papers 2009-19, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
  15. Hartmut Egger & Gabriel J. Felbermayr, 2007. "Endogenous Skill Formation and the Source Country Effects of International Labor Market Integration," CESifo Working Paper Series 2018, CESifo Group Munich.
  16. McFadden, Daniel, 1974. "The measurement of urban travel demand," Journal of Public Economics, Elsevier, vol. 3(4), pages 303-328, November.
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Cited by:
  1. Bertoli, Simone & Brücker, Herbert, 2011. "Selective immigration policies, migrants' education and welfare at origin," CEPR Discussion Papers 8196, C.E.P.R. Discussion Papers.

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