Optimal investment in human capital under migration uncertainty

Baran Siyahhan () and Hamed Ghoddusi ()
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Baran Siyahhan: IMT-BS - DEFI - Département Droit, Économie et Finances - TEM - Télécom Ecole de Management - IMT - Institut Mines-Télécom [Paris] - IMT-BS - Institut Mines-Télécom Business School - IMT - Institut Mines-Télécom [Paris], LITEM - Laboratoire en Innovation, Technologies, Economie et Management (EA 7363) - UEVE - Université d'Évry-Val-d'Essonne - Université Paris-Saclay - IMT-BS - Institut Mines-Télécom Business School - IMT - Institut Mines-Télécom [Paris]
Hamed Ghoddusi: CAL POLY - California Polytechnic State University [San Luis Obispo]

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Abstract: This paper develops a model of optimal education investment under uncertainty for an agent with an emigration option. We distinguish between local (country-specific) and global human capital and analyze the role of migration opportunities in human capital accumulation of different types. The analysis shows that human capital accumulation depends on the level of uncertainty and the transferability of human capital across countries. Allowing for human capital investment in the destination country and easier transferability of both local and global human capital exacerbate brain drain.

Keywords: Human capital investment; Immigration; Real options; Skilled labor; Sustainable Development Goals (search for similar items in EconPapers)
Date: 2022-05
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Citations: View citations in EconPapers (1)

Published in Review of International Economics, 2022, 30 (2), pp.422-449. ⟨10.1111/roie.12570⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03396049

DOI: 10.1111/roie.12570

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