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Brain drain and human capital formation in developing countries: winners and losers

Michel Beine (), Frédéric Docquier () and Hillel Rapoport

No 2006023, Discussion Papers (ECON - Département des Sciences Economiques) from Université catholique de Louvain, Département des Sciences Economiques

Abstract: The brain drain has long been viewed as a serious constraint on poor countries development. However, recent theoretical literature suggests that emigration prospects can raise the expected return to human capital and foster investment in education at home. This paper takes advantage of a new dataset on emigration rates by education level (Docquier and Marfouk, 2006) to examine the impact of brain drain migration on human capital formation in developing countries. We find evidence of a positive effect of skilled migration prospects on gross human capital levels in a cross-section of 127 developing countries. For each country we then estimate the net effect of the brain drain using counterfactual simulations. We find that countries combining relatively low levels of human capital and low skilled emigration rates are likely to experience a net gain, and conversely. There appears to be more losers than winners, and in addition the former tend to lose relatively more than what the latter gain. At an aggregate level however, and given that the largest developing countries are all among the winners, brain drain migration may be seen not only as increasing the number of skilled workers worldwide but also the number of such workers living in developing countries.

Keywords: Brain drain; skilled migration; human capital formation; immigration policy; developing countries (search for similar items in EconPapers)
JEL-codes: F22 J24 O15 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr, nep-dev, nep-edu and nep-hrm
Date: 2006-05-01
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Related works:
Journal Article: Brain Drain and Human Capital Formation in Developing Countries: Winners and Losers (2008) Downloads
Working Paper: Brain drain and human capital formation in developing countries: winners and losers? (2008)
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