Does emigration really drain human capital accumulation in origin countries? This paper explores a unique household survey designed and conducted to answer this specific question for the case of Cape Verde - the sub-Saharan African country with the largest fraction of tertiary-educated population living abroad, despite also having a fast-growing stock of human capital. Unlike previous literature, the ideal characteristics of our tailored survey allow us to explicitly test "brain gain" arguments according to which the possibility of own future emigration positvely contributes to educational attainment in the origin country. In particular, we introduce a new method to estimate this effect by using full histories of current and return migrants (which enable controlling for migrant selection on unobservables), and a new set of exclusion restrictions both at the regional and household levels. Our results are robust to the inclusion of controls for remittances, family disruption, and general equilibrium effects of emigration. In constructing a counterfactual distribution of skills to answer our research question, we combine the survey data with information from censuses of the destination cuntries to account for the characteristics of the labour force that is (permanent and temporarily) lost due to emigration. Our results point to commonly used "brain dran" figures to be significantly exaggerated, whereas there may be substantial "brain gains" from allowing free migration and encouraging return migration.
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Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number
343.
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 O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration O55 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Africa
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