RETHINKING THE BRAIN DRAIN

Oded Stark

No 18770, Discussion Papers from University of Bonn, Center for Development Research (ZEF)

Abstract: When productivity is fostered by both the individual's human capital and by the average level of human capital in the economy, individuals under-invest in human capital. A strictly positive probability of migration to a richer country, by raising both the level of human capital formed by optimizing individuals in the home country and the average level of human capital of non-migrants in the country, can enhance welfare and nudge the economy toward the social optimum. Under a well-controlled restrictive migration policy the welfare of all workers is higher than in the absence of this policy.

Keywords: Labor; and; Human; Capital (search for similar items in EconPapers)
Pages: 17
Date: 2003
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Citations: View citations in EconPapers (9)

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Journal Article: Rethinking the Brain Drain (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ubzefd:18770

DOI: 10.22004/ag.econ.18770

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