RETHINKING THE BRAIN DRAIN

When productivity is fostered by both the individual's human capital and by the average level of human capital in the economy, individuals under-invest in human capital. A strictly positive probability of migration to a richer country, by raising both the level of human capital formed by optimizing individuals in the home country and the average level of human capital of non-migrants in the country, can enhance welfare and nudge the economy toward the social optimum. Under a well-controlled restrictive migration policy the welfare of all workers is higher than in the absence of this policy.


Issue Date:
2003
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/18770
Total Pages:
17
Series Statement:
ZEF - Discussion Papers on Development Policy No. 71




 Record created 2017-04-01, last modified 2017-08-24

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