Christian Helmenstein and
Alexia Prskawetz Additional contact information Christian Helmenstein: Department of Finance, Institute for Advanced Studies, Vienna
Alexia Prskawetz: Institute for Demography, Austrian Academy of Sciences
We study human capital depletion and formation in an economy open to out-migration, as opposed to an economy which is closed. Under the natural assumption of asymmetric information, the enlarged opportunities and the associated different structure of incentives can give rise to a brain gain in conjunction with a brain drain. Migration by high-skill members of its workforce notwithstanding, the home country can end up with a higher average level of human capital per worker.