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International Education and Economic Growth

  • Bergerhoff, Jan

    ()

    (University of Bonn)

  • Borghans, Lex

    ()

    (Maastricht University)

  • Seegers, Philipp K.

    ()

    (Maastricht University)

  • van Veen, Tom

    ()

    (Maastricht University)

In recent years international student mobility increased. While net hosting countries are in a better position to win highly educated students for their labour force, they face the additional cost of providing the education. In much of continental Europe these costs are not levied on students, but are borne by the national tax payers, making them an active topic of debate. Borrowing some fundamental equations from the Lucas growth model, this paper addresses the question whether countries benefit from educating international students. We derive conditions under which international education has a positive effect on economic growth, overall and in each specific country. Based on empirically motivated parameter values to calibrate our two-country model we find that international student mobility increases steady state growth for both countries on average by 0.013 percentage points. A small country that is favoured by the inflows of a larger country could experience an extra growth of 0.049 percentage points. The benefits from international education increase when a country tunes its education and migration policy.

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File URL: http://ftp.iza.org/dp7354.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7354.

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Length: 20 pages
Date of creation: Apr 2013
Date of revision:
Publication status: published in: IZA Journal of European Labor Studies, 2013, 2:3
Handle: RePEc:iza:izadps:dp7354
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References listed on IDEAS
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  1. Hessel Oosterbeek & Dinand Webbink, 2006. "Assessing the returns to studying abroad," CPB Discussion Paper 64, CPB Netherlands Bureau for Economic Policy Analysis.
  2. Lydia Mechtenberg & Roland Strausz, . "The Bologna Process: How student mobility affects multi-cultural skills and educational quality," Papers 030, Departmental Working Papers.
  3. Agar Brugiavini & Franco Peracchi, 2005. "The Length of Working Lives in Europe," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 477-486, 04/05.
  4. Psacharopoulos, George & Patrinos, Harry Anthony, 2002. "Returns to investment in education : a further update," Policy Research Working Paper Series 2881, The World Bank.
  5. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
  6. Govert Bijwaard, 2010. "Immigrant migration dynamics model for The Netherlands," Journal of Population Economics, Springer, vol. 23(4), pages 1213-1247, September.
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