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Emigration and the quality of home country institutions

Frédéric Docquier (), Elisabetta Lodigiani, Hillel Rapoport and Maurice Schiff ()

No 2010035, Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)

Abstract: Emigration affects institutions at home in a number of ways. While people may have fewer incentives to voice when they have exit options, emigrants can voice once abroad and contribute to the diffusion of democratic values and norms. We first document these channels and then consider dynamic-panel regressions to investigate the overall impact of emigration on institutions in the home country. We find that both openess to migration and human capital have a positive impact on institutions (as measured by standard democracy and economic freedom indices). This implies that unskilled migration has a positive effect on institutional quality while the effect of skilled migration (or brain drain) is ambiguous. Using the point estimates from our regressions, we simulate the marginal effect of skilled emigration on institutional quality. In general, the simulations confirm that the brain drain has an ambiguous impact on institutions, though a significant institutional gain obtains for a limited set of countries when incentive effects of the brain drain on human capital formation are taken into account.

Keywords: Migration; brain drain; institutions; diaspora effects; democracy (search for similar items in EconPapers)
JEL-codes: O1 F22 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cmp, nep-hrm, nep-lab, nep-mig and nep-soc
Date: 2010-09-20
References: View references in EconPapers View complete reference list from CitEc
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Persistent link: https://EconPapers.repec.org/RePEc:ctl:louvir:2010035

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