Brain Gain: Claims About its Size and Impact on Welfare and Growth are Greatly Exaggerated

By Maurice Schiff. Social Science Research Network, 2005

225 citations recorded by the source corpus.

Based on static partial equilibrium analysis, the “new brain drain” literature argues that, by raising the return to education, a brain drain generates a brain gain that is, under certain conditions, larger than the brain drain itself, and that such a net brain gain results in an increase in welfare and growth due to education’s positive externalities. This paper argues that these claims are exaggerated. In the static case, and based on both partial and general equilibrium considerations, the paper shows that i) the size of the brain gain is smaller than suggested in that literature; ii) the impact on welfare and growth is smaller as well (for any brain gain size); iii) a positive brain gain is likely to result in a smaller, possibly negative, human capital gain; iv) an increase in the stock of human capital may have a negative impact on welfare and growth; and v) in a dynamic framework, the paper shows that the steady-state brain gain is equal to the brain drain so that a ‘beneficial brain drain’ cannot take place, and a net brain loss is likely during the transition.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/16fd362783367b417cd18a8bbb4df9eb12dafa10

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Citations in the corpus

Coming back home after the sun rises: Returnee entrepreneurs and growth of high tech industries (2013, background): “9 This positive evaluation has been challenged; see, for example, Schiff (2005).”
Research on Globalization and Education (2008, background): “In the most recent research for the World Bank, Chellaraj, Maskus, and Mattoo (2006) concluded that reducing the flow of students and skilled workers to the United States would have a strong negative effect on innovation in contrast to raising the number of foreign graduate students by 10%, which wo”
Brain Drain in Developing Countries (2007, background): “Between 1990 and 2000, the stock of 1 See Commander et al (2004), Docquier and Rapoport (2004) and Beine et al. (2001, 2006).”
International Scientist Mobility and the Locus of Knowledge and Technology Transfer (2011, background): “In the 1990s, the economic consequences of scientist and highly skilled worker mobility came back on the agenda of OECD countries (Salt, 1997; OECD, 2002; Schiff, 2005; Hunter et al., 2009).”