Will Transition Countries Benefit or Lose from the Brain Drain?
We analyze the theoretical effects on growth and welfare in transition economies of emigration of educated and uneducated labor, of higher emigration probability, etc. Using a Grossman-Helpman growth model, we show that the prospects of labor market integration with the EU raises the expected returns to education, stimulate human capital formation and thus raise the growth rate in the candidate countries. However, given this expected returns, emigration of educated workers tends to lower growth and welfare of those remaining. Thus, while the brain drain reduces welfare, the effects of labor market integration could nevertheless be positive. Emigration of low skilled workers also reduces growth via adverse effects on education. Higher tuition fees, common in transition countries, counteract positive growth effects of market determined wages.
|Date of creation:||27 Dec 2002|
|Publication status:||Published in International Journal of Economic Development , 2003.|
|Contact details of provider:|| Postal: Wallingatan 38, 4th floor S-111 24 Stockholm|
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- Miyagiwa, Kaz, 1991.
"Scale Economies in Education and the Brain Drain Problem,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 32(3), pages 743-759, August.
- Miyagiwa, K., 1989. "Scale Economics In Education And The Brain Drain Problem," Working Papers 89-09, University of Washington, Department of Economics.
- Miyagiwa, K., 1989. "Scale Economics In Education And The Brain Drain Problem," Discussion Papers in Economics at the University of Washington 89-09, Department of Economics at the University of Washington.
- Robert E. Hall & Charles I. Jones, 1999. "Why Do Some Countries Produce So Much More Output per Worker than Others?," NBER Working Papers 6564, National Bureau of Economic Research, Inc.
- Lam, Kit-Chun, 2002. "Interaction between Economic and Political Factors in the Migration Decision," Journal of Comparative Economics, Elsevier, vol. 30(3), pages 488-504, September.
- Nadeem U. Haque & Se-Jik Kim, 1995. "“Human Capital Flight”: Impact of Migration on Income and Growth," IMF Staff Papers, Palgrave Macmillan, vol. 42(3), pages 577-607, September.
- Lundborg, Per & Segerstrom, Paul S., 2002. "The growth and welfare effects of international mass migration," Journal of International Economics, Elsevier, vol. 56(1), pages 177-204, January.
- Lundborg, Per & Segerstrom, Paul S., 1998. "The Growth and Welfare Effects of International Mass Migration," Working Paper Series 146, Trade Union Institute for Economic Research.
- Gene M. Grossman & Elhanan Helpman, 1991. "Quality Ladders in the Theory of Growth," Review of Economic Studies, Oxford University Press, vol. 58(1), pages 43-61.
- Grossman, G.M. & Helpman, E., 1989. "Quality Ledders In The Theory Of Growth," Papers 148, Princeton, Woodrow Wilson School - Public and International Affairs.
- Gene M. Grossman & Elhanan Helpman, 1989. "Quality Ladders in the Theory of Growth," NBER Working Papers 3099, National Bureau of Economic Research, Inc.
- Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, Oxford University Press, vol. 114(1), pages 83-116.
- Peter J. Klenow & Mark Bils, 2000. "Does Schooling Cause Growth?," American Economic Review, American Economic Association, vol. 90(5), pages 1160-1183, December. Full references (including those not matched with items on IDEAS)
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