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Foreign Capital, Skill Formation, and Migration of Skilled Workers

Author

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  • Saibal Kar
  • Basudeb Guha-Khasnobis

Abstract

We study the interaction between foreign capital inflow and international migration of skilled labor when a small open economy is subject to exogenous shocks. The presence of a skill formation sector is central to our analysis, such that import liberalization and increased foreign capital inflow may lead to increased skill emigration both in absolute terms and as percentage of gross skill formation. Furthermore, a positive product price shock for the sector that uses foreign capital may turn out to be immiserizing. Finally, growth in the agricultural sector can lower the rate of skill formation as well as skill emigration.

Suggested Citation

  • Saibal Kar & Basudeb Guha-Khasnobis, 2006. "Foreign Capital, Skill Formation, and Migration of Skilled Workers," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 9(2), pages 107-123.
    • Handle: RePEc:taf:jpolrf:v:9:y:2006:i:2:p:107-123
    DOI: 10.1080/13841280600772010
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    References listed on IDEAS

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    Cited by:

    1. Subhasree Basak & Kausik Gupta, 2025. "International Fragmentation, Skill Formation and Emigration: A General Equilibrium Approach," Foreign Trade Review, , vol. 60(2), pages 233-258, May.
    2. Kar, Saibal, 2008. "Migrant remittances in the state of Kerala, India," MPRA Paper 103805, University Library of Munich, Germany.
    3. Kar, Saibal, 2009. "International labor migration, asymmetric information and occupational choice," MPRA Paper 24106, University Library of Munich, Germany.
    4. Beladi, Hamid & Marjit, Sugata & Broll, Udo, 2011. "Capital mobility, skill formation and polarization," Economic Modelling, Elsevier, vol. 28(4), pages 1902-1906, July.
    5. Marjit, Sugata & Kar, Saibal & Hazari, Bharat R., 2013. "Emigration, unemployment and welfare – The role of non-traded sector," The North American Journal of Economics and Finance, Elsevier, vol. 24(C), pages 298-305.
    6. Chaitali Sinha, 2017. "International Migration and Welfare Implications," South Asian Journal of Macroeconomics and Public Finance, , vol. 6(2), pages 209-229, December.
    7. Yunyun Wu & Xiaochun Li, 2021. "International factor mobility and environment in a dual agricultural economy," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 66(1), pages 75-89, February.

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