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Must Skilled Migration Be a Brain Drain? Evidence from the Indian Software Industry

  • Commander, Simon

    ()

    (IE Business School, Altura Partners)

  • Chanda, Rupa

    ()

    (IIM)

  • Kangasniemi, Mari

    ()

    (London School of Economics)

  • Winters, L. Alan

    ()

    (University of Sussex)

We provide a first empirical attempt at understanding the scale and type of skilled migration from the Indian software sector and the consequences for firms experiencing loss of skilled workers. The paper draws on some unique survey evidence of software firms in India. The results are not generally consistent with an adverse or brain drain story but provide a more nuanced interpretation. Not only has skilled migration taken a variety of firms – including significant temporary migration – but the evidence suggests that the impact of mobility on performance in the sending firms has not been unambiguously adverse. There is some evidence of associated wage pressure at the height of the software boom in the late 1990s. But there is also evidence of a strong supply side response as workers acquired training and entered the sector.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1422.

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Length: 32 pages
Date of creation: Dec 2004
Date of revision:
Publication status: published in: World Economy, 2008, 31 (2), 187-211
Handle: RePEc:iza:izadps:dp1422
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  1. Donald R. Davis & David E. Weinstein, 2002. "Technological Superiority and the Losses from Migration," NBER Working Papers 8971, National Bureau of Economic Research, Inc.
  2. Michel Beine & Frédéric Docquier & Hillel Rapoport, 2001. "Brain drain and economic growth: theory and evidence," ULB Institutional Repository 2013/10449, ULB -- Universite Libre de Bruxelles.
  3. Beine, Michel & Docquier, Frédéric & Rapoport, Hillel, 2003. "Brain Drain and LDCs' Growth: Winners and Losers," IZA Discussion Papers 819, Institute for the Study of Labor (IZA).
  4. 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.
  5. William Carrington & Enrica Detragiache, 1998. "How Big is the Brain Drain?," IMF Working Papers 98/102, International Monetary Fund.
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