Rethinking the brain drain

Oded Stark*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

When productivity is fostered by both the individual's human capital and by the average level of human capital in the economy, individuals underinvest 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 nonmigrants 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.

Original languageEnglish
Pages (from-to)15-22
Number of pages8
JournalWorld Development
Volume32
Issue number1
DOIs
StatePublished - Jan 2004
Externally publishedYes

Keywords

  • Externalities
  • Human capital formation
  • Migration
  • Social welfare

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