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International migration and "educated unemployment"

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  • Fan, C. Simon
  • Stark, Oded

Abstract

This paper provides a novel explanation of "educated unemployment," which is a salient feature of the labor markets in a number of developing countries. In a simple job-search framework we show that "educated unemployment" is caused by the perspective of international migration, that is, by the possibility of a "brain drain." In addition, the analysis shows that a developing country may end up with more educated workers despite the brain drain and educated unemployment.
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Suggested Citation

  • Fan, C. Simon & Stark, Oded, 2007. "International migration and "educated unemployment"," Journal of Development Economics, Elsevier, vol. 83(1), pages 76-87, May.
  • Handle: RePEc:eee:deveco:v:83:y:2007:i:1:p:76-87
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    References listed on IDEAS

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    1. Mountford, Andrew, 1997. "Can a brain drain be good for growth in the source economy?," Journal of Development Economics, Elsevier, vol. 53(2), pages 287-303, August.
    2. Ashenfelter, Orley & Ham, John, 1979. "Education, Unemployment, and Earnings," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 99-116, October.
    3. Stark, Oded & Helmenstein, Christian & Prskawetz, Alexia, 1997. "A brain gain with a brain drain," Economics Letters, Elsevier, vol. 55(2), pages 227-234, August.
    4. Joseph Schaafsma & Arthur Sweetman, 2001. "Immigrant earnings: age at immigration matters," Canadian Journal of Economics, Canadian Economics Association, vol. 34(4), pages 1066-1099, November.
    5. Stark, Oded & Helmenstein, Christian & Prskawetz, Alexia, 1998. "Human capital depletion, human capital formation, and migration: a blessing or a "curse"?," Economics Letters, Elsevier, vol. 60(3), pages 363-367, September.
    6. Daron Acemoglu & Robert Shimer, 1999. "Efficient Unemployment Insurance," Journal of Political Economy, University of Chicago Press, vol. 107(5), pages 893-928, October.
    7. Todaro, Michael P, 1969. "A Model for Labor Migration and Urban Unemployment in Less Developed Countries," American Economic Review, American Economic Association, vol. 59(1), pages 138-148, March.
    8. Stark, Oded & Wang, Yong, 2002. "Inducing human capital formation: migration as a substitute for subsidies," Journal of Public Economics, Elsevier, vol. 86(1), pages 29-46, October.
    9. Stark, Oded, 2004. "Rethinking the Brain Drain," World Development, Elsevier, vol. 32(1), pages 15-22, January.
    10. repec:pri:indrel:dsp01fb494841t is not listed on IDEAS
    11. Bhagwati, Jagdish & Hamada, Koichi, 1974. "The brain drain, international integration of markets for professionals and unemployment : A theoretical analysis," Journal of Development Economics, Elsevier, vol. 1(1), pages 19-42, April.
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    Cited by:

    1. repec:spr:jopoec:v:30:y:2017:i:4:d:10.1007_s00148-017-0641-4 is not listed on IDEAS
    2. Yabuuchi, Shigemi & Chaudhuri, Sarbajit, 2009. "Skill Formation, Capital Adjustment Cost and Wage Inequality," MPRA Paper 18381, University Library of Munich, Germany.
    3. repec:eee:reveco:v:54:y:2018:i:c:p:165-177 is not listed on IDEAS
    4. Katarzyna Budnik, 2011. "Emigration Triggers: International Migration of Polish Workers between 1994 and 2009," NBP Working Papers 90, Narodowy Bank Polski, Economic Research Department.
    5. Abubakar Lawan Ngoma & Normaz Wana Ismail, 2013. "The Impact of Brain Drain on Human Capital in Developing Countries," South African Journal of Economics, Economic Society of South Africa, vol. 81(2), pages 211-224, June.
    6. Stark, Oded & Byra, Lukasz & Casarico, Alessandra & Uebelmesser, Silke, 2017. "A critical comparison of migration policies: Entry fee versus quota," Regional Science and Urban Economics, Elsevier, vol. 66(C), pages 91-107.
    7. Boccanfuso, Dorothée & Larouche, Alexandre & Trandafir, Mircea, 2015. "Quality of Higher Education and the Labor Market in Developing Countries: Evidence from an Education Reform in Senegal," World Development, Elsevier, vol. 74(C), pages 412-424.
    8. Frédéric Docquier & Hillel Rapoport, 2012. "Globalization, Brain Drain, and Development," Journal of Economic Literature, American Economic Association, vol. 50(3), pages 681-730, September.
    9. Leonid V. Azarnert, 2012. "Guest‐worker Migration, Human Capital and Fertility," Review of Development Economics, Wiley Blackwell, vol. 16(2), pages 318-330, May.
    10. de Haas, Hein, 2009. "Mobility and Human Development," MPRA Paper 19176, University Library of Munich, Germany.
    11. Adriana Luciano & Roberto Di Monaco, 2011. "Skilled Labour market and economic development in the Mediterranean area," Working Papers 42, AlmaLaurea Inter-University Consortium.
    12. Dong, Baomin & Fu, Shihe & Gong, Jiong & Fan, Hanwen, 2014. "The Lame Drain," MPRA Paper 53825, University Library of Munich, Germany.
    13. Chaudhuri, Sarbajit & Bandopadhyay, Titas Kumar, 2012. "Endogenous skill formation, foreign capital and education subsidy in a dual economy," MPRA Paper 41631, University Library of Munich, Germany.
    14. C. Simon Fan & Oded Stark, 2007. "The brain drain, 'educated unemployment', human capital formation, and economic betterment," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 15, pages 629-660, October.
    15. Stark, Oded & Byra, Lukasz, 2012. "A back-door brain drain," Economics Letters, Elsevier, vol. 116(3), pages 273-276.
    16. Azarnert, Leonid V., 2010. "Is skilled immigration always good for growth in the receiving economy?," Economics Letters, Elsevier, vol. 108(2), pages 116-118, August.
    17. Qin, Fei, 2015. "Global talent, local careers: Circular migration of top Indian engineers and professionals," Research Policy, Elsevier, vol. 44(2), pages 405-420.
    18. Olena Ivus & Alireza Naghavi, 2014. "Migration, technology diffusion and institutional development at the origin," Chapters,in: International Handbook on Migration and Economic Development, chapter 10, pages 267-287 Edward Elgar Publishing.
    19. Pieretti, Patrice & Zou, Benteng, 2009. "Brain drain and factor complementarity," Economic Modelling, Elsevier, vol. 26(2), pages 404-413, March.
    20. Byra, Lukasz, 2013. "Rethinking the brain drain: Dynamics and transition," International Review of Economics & Finance, Elsevier, vol. 28(C), pages 19-25.
    21. Bang, James T. & Mitra, Aniruddha, 2011. "Brain drain and institutions of governance: Educational attainment of immigrants to the US 1988-1998," Economic Systems, Elsevier, vol. 35(3), pages 335-354, September.
    22. Aaron Jackson & David Ortmeyer & Michael Quinn, 2013. "Are immigrants really attracted to the welfare state? Evidence from OECD countries," International Economics and Economic Policy, Springer, vol. 10(4), pages 491-519, December.
    23. Hung-Ju Chen & Xiangbo Liu, 2015. "International Migration, Skill Acquisition and Matching Frictions," Economics Bulletin, AccessEcon, vol. 35(3), pages 1469-1476.
    24. Stark, Oded & Casarico, Alessandra & Devillanova, Carlo & Uebelmesser, Silke, 2012. "On the formation of international migration policies when no country has an exclusive policy-setting say," Regional Science and Urban Economics, Elsevier, vol. 42(3), pages 420-429.

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