The Brain Drain: What are the consequences for development of the most highly skilled migrating?

Original source: SimoleonSense.com .

Introduction (via Gibson & McKenzie @ Voxeu)
Some argue that the global competition for talented workers leads to a “brain drain” robbing poor countries of their brightest sparks and stifling development. Others suggest that the local economy can benefit through trade, investment, and knowledge transfer. This column argues that for developing countries with the largest high-skilled migration, neither is spot on – by far the biggest impact is on the migrants themselves.

If you were born in the Pacific Islands or the Caribbean and have a university education, the chances are that you have moved abroad – well over half do so (Beineet al. 2008). High-skilled migration is also commonplace in a number of larger developing countries, especially in sub-Saharan Africa. In Ghana, 47% of those with a tertiary education live outside of the country (Docquier and Marfouk 2005).

Given such large numbers of high-skilled migrants abroad, it is perhaps no surprise that policymakers (and economists, e.g. Bhagwati and Hamada 1974) have been worrying for decades about whether this represents a loss in valuable human capital and fiscal revenues. Yet in more recent times a counterargument has emerged that the prospect of migration may induce additional human capital formation among those who remain, and that migrants can spur trade and investment, as seen in the experience of Taiwanese, Indian and Chinese migrants in Silicon Valley setting up technology firms back home.

What has been largely missing from this debate has been actual empirical evidence of how high-skilled migrants interact with their home countries, especially for the types of countries with the highest skilled-migration rates.

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