Differential migration prospects, skill formation, and welfare
AbstractThis paper develops a one sector, two-input model with endogenous human capital formation. The two inputs are two types of skilled labor: engineering, which exerts a positive externality on total factor productivity, and law, which does not. The paper shows that a marginal prospect of migration by engineers increases human capital accumulation of both types of workers (engineers and lawyers), and also the number of engineers who remain in the country. These two effects are socially desirable, since they move the economy from the(inefficient) free-market equilibrium towards the social optimum. The paper also shows that if the externality effect of engineering is sufficiently powerful, everyone will be better off as a consequence of the said prospect of migration, including the engineers who lose the migration lottery, and even the individuals who practice law. --
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Bibliographic InfoPaper provided by University of Tuebingen, Faculty of Economics and Social Sciences in its series University of Tuebingen Working Papers in Economics and Finance with number 22.
Date of creation: 2011
Date of revision:
heterogeneous human capital; differential externality effects; migration of educated workers; human capital formation; efficient acquisition of human capital; beneficial brain drain;
Other versions of this item:
- Oded Stark & Roman Zakharenko, 2012. "Differential Migration Prospects, Skill Formation, and Welfare," Review of International Economics, Wiley Blackwell, vol. 20(4), pages 657-673, 09.
- Stark, Oded & Zakharenko, Roman, 2011. "Differential Migration Prospects, Skill Formation, and Welfare," Discussion Papers 119111, University of Bonn, Center for Development Research (ZEF).
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers
- R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Why India should let engineers and doctors emigrate
by Economic Logician in Economic Logic on 2012-01-11 15:28:00
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