Migration and human capital in an endogenous fertility model
What is the impact of high-skilled emigration on fertility and human capital in migrants’ origin countries? This question is analyzed within an overlapping generations model where parents choose to finance higher education to a certain number of their children. It follows that families are composed of high- and low-skilled children who may both emigrate with a certain probability when they reach adulthood. It is found that a brain drain leads to a change in children’s skill composition, with parents choosing to provide higher education to a larger number of their children. A calibration of the model suggests that, following a brain drain, the additional children benefiting from higher education might in the long run compensate for the loss of high-educated workers and lead to a brain gain.
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