Brain drain, R&D-cost differentials and the innovation gap
AbstractThis paper aims at explaining why countries with comparable levels of education still experience notable differences in terms of R&D and innovation. High-skilled migration, ultimately linked to differences in R&D costs, might be responsible for the persistence of such a gap. In fact, in a model where human capital accumulation and innovation are strategic complements, we show that allowing labor outflows may strengthen educational incentives in the lagging economy if migration is probabilistic in nature, but at the same time reduces the share of innovative production. Income (growth) might be consequently affected, and a positive migration chance is very unlikely to act as a substitute for educational subsidies.
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Date of creation: 2008
Date of revision:
Publication status: Published, Recherches Economiques de Louvain - Louvain Economic Review, 2008, 74, 3, 251-272
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Innovation; Education; Brain drain.;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-08-06 (All new papers)
- NEP-EDU-2008-08-06 (Education)
- NEP-HRM-2008-08-06 (Human Capital & Human Resource Management)
- NEP-INO-2008-08-06 (Innovation)
- NEP-KNM-2008-08-06 (Knowledge Management & Knowledge Economy)
- NEP-LAB-2008-08-06 (Labour Economics)
- NEP-MIC-2008-08-06 (Microeconomics)
- NEP-MIG-2008-08-06 (Economics of Human Migration)
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