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The Gain from the Drain: Skill-biased Migration and Global Welfare

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  • Biavaschi, Costanza

    () (Norwegian University of Science and Technology (NTNU))

  • Burzynski, Michal

    () (LISER)

  • Elsner, Benjamin

    () (University College Dublin)

  • Machado, Joel

    () (University of Luxembourg)

Abstract

High-skilled workers are four times more likely to migrate than low-skilled workers. This skill bias in migration – often called brain drain – has been at the center of a heated debate about the welfare consequences of emigration from developing countries. In this paper, we provide a global perspective on the brain drain by jointly quantifying its impact on the sending and receiving countries. In a calibrated multi-country model, we compare the current world to a counterfactual with the same number of migrants, but those migrants are randomly selected from their country of origin. We find that the skill bias in migration significantly increases welfare in most receiving countries. Moreover, due to a more efficient global allocation of talent, the global welfare effect is positive, albeit some sending countries lose. Overall, our findings suggest that more – not less – high-skilled migration would increase world welfare.

Suggested Citation

  • Biavaschi, Costanza & Burzynski, Michal & Elsner, Benjamin & Machado, Joel, 2016. "The Gain from the Drain: Skill-biased Migration and Global Welfare," IZA Discussion Papers 10275, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp10275
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    Cited by:

    1. Michal burzynski & Christoph Deuster & Frédéric Docquier, 2018. "The Geography of Talent: Development Implications and Long-Run Prospects," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2018002, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    2. repec:kap:jecgro:v:23:y:2018:i:2:d:10.1007_s10887-017-9153-z is not listed on IDEAS
    3. Michal Burzynski, 2016. "Time, Space and Skills in Designing Migration Policy," CREA Discussion Paper Series 16-12, Center for Research in Economic Analysis, University of Luxembourg.
    4. Burzynski, Michal & Deuster, Christoph & Docquier, Frédéric, 2018. "Geography of Skills and Global Inequality," IZA Discussion Papers 11804, Institute for the Study of Labor (IZA).
    5. Marco Delogu & Frédéric Docquier & Joël Machado, 2018. "Globalizing labor and the world economy: the role of human capital," Journal of Economic Growth, Springer, vol. 23(2), pages 223-258, June.

    More about this item

    Keywords

    migration; brain drain; global welfare;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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