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Migration and Education Decisions in a Dynamic General Equilibrium Framework

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Abstract

With growing international skilled labor mobility, education and migration decisions have become increasingly inter-related, and potentially have a large impact on the growth trajectories of source countries, through their effects on labor supply, savings, or the cost of education. The authors develop a generic dynamic general equilibrium model to analyze the education-migration nexus in a consistent framework. They use the model as a laboratory to test empirical conditions for the existence of net brain gain, that is, greater domestic accumulation of human capital (in per capita terms) with greater migration of skilled workers. The results suggest that although some structural parameters can favor simultaneously greater human capital accumulation and greater skilled migration --such as high ratio of remittances over domestic incomes, high dependency ratios in migrant households, low dependency ratios in source countries, increasing returns to scale in the education sector, technological transfers and export market access with Diasporas, and efficient financial markets -- this does not necessarily mean that greater migration encourages the constitution of greater stocks of human capital in source countries.

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  • Dessus, Sebastien & Nahas, Charbel, 2008. "Migration and Education Decisions in a Dynamic General Equilibrium Framework," Policy Research Working Paper Series 4775, The World Bank.
    • Handle: RePEc:wbk:wbrwps:4775
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    1. Docquier, Frédéric & Faye, Ousmane & Pestieau, Pierre, 2008. "Is migration a good substitute for education subsidies?," Journal of Development Economics, Elsevier, vol. 86(2), pages 263-276, June.
    2. Michel Beine & Fréderic Docquier & Hillel Rapoport, 2008. "Brain Drain and Human Capital Formation in Developing Countries: Winners and Losers," Economic Journal, Royal Economic Society, vol. 118(528), pages 631-652, April.
    3. Beine, Michel & Docquier, Frederic & Rapoport, Hillel, 2001. "Brain drain and economic growth: theory and evidence," Journal of Development Economics, Elsevier, vol. 64(1), pages 275-289, February.
    4. Devesh Kapur, 2001. "Diasporas and Technology Transfer," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 2(2), pages 265-286.
    5. 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.
    6. Beghin, John C. & Dessus, Sebastien & Roland-Holst, David & Van der Mensbrugghe, Dominique, 2002. "Empirical Modelling of Trade and the Environment," Staff General Research Papers Archive 5385, Iowa State University, Department of Economics.
    7. Satish Chand & Michael A. Clemens, 2008. "Skilled emigration and skill creation: A quasi-experiment," International and Development Economics Working Papers idec08-05, International and Development Economics.
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    Keywords

    Migration; Education; Brain Gain; Brain Drain; General Equilibrium Models;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • P36 - Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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