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Migration, knowledge diffusion and the comparative advantage of nations

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  • Bahar, Dany
  • Hillel Rapoport

Abstract

To what extent are migrants a source of evolution of the comparative advantage of both their sending and receiving countries? We study the drivers of knowledge diffusion by looking at the dynamics of the export basket of countries. The main finding is that migration is a strong and robust driver of productive knowledge diffusion. In terms of their ability to induce exports, we find that an increase of only 65,000 people in the stock of migrants for the average country, is associated with about 15% increase in the likelihood of adding a new product to a country's export basket. We also find that, in terms of expanding the export basket of countries, a migrant is worth about US $30,000 of foreign direct investment. For skilled migrants these same figures become 15,000 people and US $160,000. In order to alleviate endogeneity concerns, we present results based on instrumenting for migration stocks using bilateral geographic and cultural variables.

Suggested Citation

  • Bahar, Dany & Hillel Rapoport, 2013. "Migration, knowledge diffusion and the comparative advantage of nations," Working Paper 97706, Harvard University OpenScholar.
  • Handle: RePEc:qsh:wpaper:97706
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    Citations

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    Cited by:

    1. Michael A. Clemens, 2016. "Losing our minds? New research directions on skilled emigration and development," International Journal of Manpower, Emerald Group Publishing, vol. 37(7), pages 1227-1248, October.
    2. Hausmann, Ricardo & Neffke, Frank, 2016. "The Workforce of Pioneer Plants," Working Paper Series 16-006, Harvard University, John F. Kennedy School of Government.
    3. Hillel Rapoport, 2018. "Diaspora externalities: A view from the South," WIDER Working Paper Series 025, World Institute for Development Economic Research (UNU-WIDER).
    4. William R Kerr, 2018. "Heterogeneous Technology Diffusion and Ricardian Trade Patterns," World Bank Economic Review, World Bank Group, vol. 32(1), pages 163-182.
    5. Clemens, Michael & Pritchett, Lant, 2016. "The New Case for Migration Restrictions: An Assessment," Working Paper Series rwp16-054, Harvard University, John F. Kennedy School of Government.
    6. Walter Steingress, 2018. "The causal impact of migration on US trade: Evidence from political refugees," Canadian Journal of Economics, Canadian Economics Association, vol. 51(4), pages 1312-1338, November.
    7. repec:eee:eecrev:v:111:y:2019:i:c:p:1-34 is not listed on IDEAS
    8. Dany Bahar & Hillel Rapoport, 2018. "Migration, Knowledge Diffusion and the Comparative Advantage of Nations," Economic Journal, Royal Economic Society, vol. 128(612), pages 273-305, July.
    9. Gathani Sachin & Stoelinga Dimitri, 2013. "Export Similarity Networks and Proximity Control Methods for Comparative Case Studies," Journal of Globalization and Development, De Gruyter, vol. 3(2), pages 1-39, March.
    10. Clemens, Michael A. & Pritchett, Lant, 2016. "The New Economic Case for Migration Restrictions: An Assessment," IZA Discussion Papers 9730, Institute for the Study of Labor (IZA).
    11. Jérôme Valette, 2018. "Do Migrants Transfer Productive Knowledge Back to Their Origin Countries?," Journal of Development Studies, Taylor & Francis Journals, vol. 54(9), pages 1637-1656, September.
    12. Simone Bertoli, 2015. "Does return migration influence fertility at home?," IZA World of Labor, Institute for the Study of Labor (IZA), pages 204-204, November.
    13. Michał Burzyński & Frédéric Docquier & Hillel Rapoport, 2018. "The Changing Structure of Immigration to the OECD: What Welfare Effects on Member Countries?," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 66(3), pages 564-601, September.
    14. Ricardo Hausmann & Juan Obach & Miguel Angel Santos, 2016. "Special Economic Zones in Panama: Technology Spillovers from a Labor Market Perspective," CID Working Papers 326, Center for International Development at Harvard University.
    15. Hillel Rapoport, 2017. "Who is Afraid of the Brain Drain? A Development Economist’s View," CEPII Policy Brief 2017-14, CEPII research center.
    16. Ron Boschma, 2017. "Relatedness as driver behind regional diversification: a research agenda," Papers in Evolutionary Economic Geography (PEEG) 1702, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Jan 2017.
    17. Hausmann, Ricardo & Obach, Juan & Santos, Miquel Angel, 2016. "Special Economic Zones in Panama: A Critical Assessment," Working Paper Series rwp16-044, Harvard University, John F. Kennedy School of Government.
    18. Ron Boschma, 2018. "The geographical dimension of structural change," Papers in Evolutionary Economic Geography (PEEG) 1839, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Nov 2018.
    19. Dany Bahar & Rodrigo Wagner & Ernesto Stein & Samuel Rosenow, 2017. "The Birth and Growth of New Export Clusters: Which Mechanisms Drive Diversification?," CID Working Papers 86a, Center for International Development at Harvard University.

    More about this item

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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