Youth Drain Entrepreneurship and Innovation

Massimo Anelli, Gaetano Basso, Giuseppe Ippedico () and Giovanni Peri

No 1240, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: Migration outflows, especially of young people, may deprive an economy of entrepreneurial energy and innovative ideas. We exploit exogenous variation in emigration from Italian local labor markets to show that between 2008 and 2015 larger emigration flows reduced firm creation. The decline affected firms owned by young people and innovative industries. We estimate that for every 1,000 emigrants, 100 fewer young-owned firms were created cumulatively over the whole period. A simple accounting exercise shows that about 60 percent of the effect is generated simply by the loss of young people; the remaining 40 percent is due to a combination of selection of emigrants among highly entrepreneurial people, negative spillovers on the entrepreneurship rate of locals, and negative local firm multiplier effect.

Keywords: emigration; demography; brain drain; entrepreneurship; innovation (search for similar items in EconPapers)
JEL-codes: H7 J61 M13 O3 (search for similar items in EconPapers)
Date: 2019-10
New Economics Papers: this item is included in nep-ent, nep-eur, nep-ino, nep-lab, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Working Paper: Youth Drain, Entrepreneurship and Innovation (2019)
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