Migration and dynamics: How a leakage of human capital lubricates the engine of economic growth

Gerhard Sorger, Oded Stark, Yong Wang

Research output: Contribution to journalArticlepeer-review

Abstract

This paper studies the growth dynamics of a developing country under migration. Assuming that human capital formation is subject to a strong enough, positive intertemporal externality, the prospect of migration will increase growth in the home country in the long run. If the external effect is less strong, there exists at least a level effect on the stock of human capital in the home country. In either case, the home country experiences a welfare gain, provided that migration is sufficiently restrictive. These results, obtained in a dynamic general equilibrium setting, extend and strengthen the results of Stark and Wang (2002) obtained in the context of a static model.

Original languageEnglish
Pages (from-to)26-37
Number of pages12
JournalInternational Review of Economics and Finance
Volume28
DOIs
StatePublished - Oct 2013
Externally publishedYes

Keywords

  • Intertemporal human capital externalities
  • Long-run growth effect of the prospect of migration
  • Overlapping-generations growth model
  • Social welfare gains

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