IDEAS home Printed from https://ideas.repec.org/a/jed/journl/v40y2015i1p1-34.html
   My bibliography  Save this article

Brain Drain And Brain Waste

Author

Listed:
  • ARMANDO J. GARCIA PIRES

    () (Centre for Applied Research at NHH, Norwegian School of Economics, Norway)

Abstract

When skilled workers migrate, they face the brain waste risk, i.e., they can end up employed as unskilled. We analyze the effects of brain waste on brain drain, resulting from low international transferability of skills. We show that this type of brain waste: (1) reduces education incentives; (2) weakens the chances for a positive self-selection; and (3) decreases the possibility of a brain gain. In addition, the effectiveness of education policies that subsidize students is reduced under the presence of brain waste. Results are robust to introducing different migration costs for the skilled and the unskilled.

Suggested Citation

  • Armando J. Garcia Pires, 2015. "Brain Drain And Brain Waste," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 40(1), pages 1-34, March.
  • Handle: RePEc:jed:journl:v:40:y:2015:i:1:p:1-34
    as

    Download full text from publisher

    File URL: http://www.jed.or.kr/full-text/40-1/1.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Docquier, Frederic & Rapoport, Hillel, 2004. "Skilled migration: the perspective of developing countries," Policy Research Working Paper Series 3382, The World Bank.
    2. John Gibson & David McKenzie, 2011. "Eight Questions about Brain Drain," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 107-128, Summer.
    3. Cristina Fernández & Carolina Ortega, 2008. "Labor market assimilation of immigrants in Spain: employment at the expense of bad job-matches?," Spanish Economic Review, Springer;Spanish Economic Association, vol. 10(2), pages 83-107, June.
    4. Weiping Kostenko & Mark Harris & Xueyan Zhao, 2012. "Occupational transition and country-of-origin effects in the early stage occupational assimilation of immigrants: some evidence from Australia," Applied Economics, Taylor & Francis Journals, vol. 44(31), pages 4019-4035, November.
    5. Li, Qing & Sweetman, Arthur, 2014. "The quality of immigrant source country educational outcomes: Do they matter in the receiving country?," Labour Economics, Elsevier, vol. 26(C), pages 81-93.
    6. Kaarsen, Nicolai, 2014. "Cross-country differences in the quality of schooling," Journal of Development Economics, Elsevier, vol. 107(C), pages 215-224.
    7. Aldashev Alisher & Gernandt Johannes & Thomsen Stephan L., 2012. "The Immigrant-Native Wage Gap in Germany," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 232(5), pages 490-517, October.
    8. Joni Hersch, 2008. "Profiling the New Immigrant Worker: The Effects of Skin Color and Height," Journal of Labor Economics, University of Chicago Press, vol. 26(2), pages 345-386, April.
    9. Kristin F. Butcher & John Dinardo, 2002. "The Immigrant and Native-Born Wage Distributions: Evidence from United States Censuses," ILR Review, Cornell University, ILR School, vol. 56(1), pages 97-121, October.
    10. Borjas, George J, 1985. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 3(4), pages 463-489, October.
    11. Friedberg, Rachel M, 2000. "You Can't Take It with You? Immigrant Assimilation and the Portability of Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 18(2), pages 221-251, April.
    12. de la Croix, David & Doepke, Matthias, 2004. "Public versus private education when differential fertility matters," Journal of Development Economics, Elsevier, vol. 73(2), pages 607-629, April.
    13. Anabela Carneiro & Natércia Fortuna & José Varejão, 2012. "Immigrants at new destinations: how they fare and why," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(3), pages 1165-1185, July.
    14. Ravi Kanbur & Hillel Rapoport, 2005. "Migration selectivity and the evolution of spatial inequality," Journal of Economic Geography, Oxford University Press, vol. 5(1), pages 43-57, January.
    15. Nicola D. Coniglio & Giuseppe De Arcangelis & Laura Serlenga, 2009. "Intentions to Return of Clandestine Migrants: The Perverse Effect of Illegality on Skills," Review of Development Economics, Wiley Blackwell, vol. 13(4), pages 641-657, November.
    16. Egger Hartmut & Felbermayr Gabriel, 2009. "Endogenous Skill Formation and the Source Country Effects of Skilled Labor Emigration from Developing Countries," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 229(6), pages 706-729, December.
    17. Alan de Brauw & John Giles, 2017. "Migrant Opportunity and the Educational Attainment of Youth in Rural China," Journal of Human Resources, University of Wisconsin Press, vol. 52(1), pages 272-311.
    18. David McKenzie & Hillel Rapoport, 2011. "Can migration reduce educational attainment? Evidence from Mexico," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(4), pages 1331-1358, October.
    19. Yamauchi, Futoshi, 2004. "Are experience and schooling complementary? Evidence from migrants' assimilation in the Bangkok labor market," Journal of Development Economics, Elsevier, vol. 74(2), pages 489-513, August.
    20. Diep Phan, 2012. "Migration and Credit Constraints: Theory and Evidence from Vietnam," Review of Development Economics, Wiley Blackwell, vol. 16(1), pages 31-44, February.
    21. Michael S. Michael, 2011. "Welfare Effects of Immigration Policies in the Presence of Skilled, Unskilled Labor and Capital Mobility," Review of Development Economics, Wiley Blackwell, vol. 15(4), pages 651-663, November.
    22. Hoyt Bleakley & Aimee Chin, 2004. "Language Skills and Earnings: Evidence from Childhood Immigrants," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 481-496, May.
    23. Frederic DOCQUIER & Çaglar OZDEN & Giovanni PERI, 2010. "The Wage Effects of Immigration and Emigration," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2010044, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    24. Mattoo, Aaditya & Neagu, Ileana Cristina & Özden, Çaglar, 2008. "Brain waste? Educated immigrants in the US labor market," Journal of Development Economics, Elsevier, vol. 87(2), pages 255-269, October.
    25. Edward Funkhouser & Stephen J. Trejo, 1995. "The Labor Market Skills of Recent Male Immigrants: Evidence from the Current Population Survey," ILR Review, Cornell University, ILR School, vol. 48(4), pages 792-811, July.
    26. 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.
    27. Christian Dustmann & Yoram Weiss, 2007. "Return Migration: Theory and Empirical Evidence," CReAM Discussion Paper Series 0702, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    28. Karin Mayr & Giovanni Peri, 2008. "Return Migration as Channel of Brain Gain," CReAM Discussion Paper Series 0804, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    29. Christian Dustmann & Yoram Weiss, 2007. "Return Migration: Theory and Empirical Evidence from the UK," British Journal of Industrial Relations, London School of Economics, vol. 45(2), pages 236-256, June.
    30. 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.
    31. Alejandra Cox Edwards & Manuelita Ureta, 2003. "International Migration, Remittances, and Schooling: Evidence from El Salvador," NBER Working Papers 9766, National Bureau of Economic Research, Inc.
    32. Tamura, Robert, 1991. "Income Convergence in an Endogenous Growth Model," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 522-540, June.
    33. Roland Bénabou, 1996. "Equity and Efficiency in Human Capital Investment: The Local Connection," Review of Economic Studies, Oxford University Press, vol. 63(2), pages 237-264.
    34. Bernt Bratsberg, 2002. "School Quality and Returns to Education of U.S. Immigrants," Economic Inquiry, Western Economic Association International, vol. 40(2), pages 177-198, April.
    35. Edwards, Alejandra Cox & Ureta, Manuelita, 2003. "International migration, remittances, and schooling: evidence from El Salvador," Journal of Development Economics, Elsevier, vol. 72(2), pages 429-461, December.
    36. Wright, Robert E & Maxim, Paul S, 1993. "Immigration Policy and Immigrant Quality: Empirical Evidence from Canada," Journal of Population Economics, Springer;European Society for Population Economics, vol. 6(4), pages 337-352, November.
    37. Robert F. Schoeni, 1997. "New Evidence on the Economic Progress of Foreign-Born Men in the 1970s and 1980s," Journal of Human Resources, University of Wisconsin Press, vol. 32(4), pages 683-740.
    38. 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.
    39. Sweetman, Arthur, 2004. "Immigrant Source Country Educational Quality and Canadian Labour Market Outcomes," Analytical Studies Branch Research Paper Series 2004234e, Statistics Canada, Analytical Studies Branch.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Elise S. Brezis, 2018. "Is Brain Drain passé? The Optimal Timing of Migration," Working Papers 2018-02, Bar-Ilan University, Department of Economics.
    2. Tijan L. Bah, 2018. "Occupation-skill mismatch and selection of immigrants: Evidence from the Portuguese labor market," NOVAFRICA Working Paper Series wp1804, Universidade Nova de Lisboa, Faculdade de Economia, NOVAFRICA.
    3. Brezis Elise S., 2019. "Should individuals migrate before acquiring education or after? A new model of Brain Waste vs. Brain Drain," The B.E. Journal of Macroeconomics, De Gruyter, vol. 19(2), pages 1-11, June.
    4. Akira Shimada, 2019. "Should the Government Promote Global Education?," European Research Studies Journal, European Research Studies Journal, vol. 0(2), pages 323-341.

    More about this item

    Keywords

    Brain Drain; Brain Waste; Self-Selection; International Transferability of Human Capital;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jed:journl:v:40:y:2015:i:1:p:1-34. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sung Y. Park). General contact details of provider: http://edirc.repec.org/data/eccaukr.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.