Growth Effects of the Brain Drain

Per Lundborg

A chapter in Labor Mobility and the World Economy, 2006, pp 331-345 from Springer

Abstract: Abstract I analyze the theoretical effects on growth and welfare of emigration of educated and uneducated labor, of higher emigration probability, etc. Using a Grossman-Helpman growth model, I show that the prospects of emigration to high-wage countries raises the expected returns to education, stimulates human capital formation, and raises the growth rate in the emigration country. Given the expected returns, emigration of educated workers lowers growth and the welfare of those remaining. Thus, while the brain drain reduces welfare, the effects of globalization could nevertheless be positive. Emigration of low-skilled workers also reduces growth via adverse effects on education. Higher tuition fees counteract positive growth effects.

Keywords: Human Capital; Production Worker; Growth Effect; Brain Drain; Relative Wage (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-540-31045-7_22

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DOI: 10.1007/978-3-540-31045-7_22

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