Working Paper Series, FIEF - Trade Union Institute for Economic Research
Per Lundborg and Calin Rechea
Will Transition Countries Benefit or Lose from the Brain Drain?
Abstract: We analyze the theoretical effects on growth and welfare
in transition economies of emigration of educated and uneducated labor, of
higher emigration probability, etc. Using a Grossman-Helpman growth model,
we show that the prospects of labor market integration with the EU raises
the expected returns to education, stimulate human capital formation and
thus raise the growth rate in the candidate countries. However, given this
expected returns, emigration of educated workers tends to lower growth and
welfare of those remaining. Thus, while the brain drain reduces welfare,
the effects of labor market integration could nevertheless be positive.
Emigration of low skilled workers also reduces growth via adverse effects
on education. Higher tuition fees, common in transition countries,
counteract positive growth effects of market determined wages.
Keywords: Migration; Growth; Welfare; (follow links to similar papers)
JEL-Codes: J61; O40; (follow links to similar papers)
18 pages, December 27, 2002
Before downloading any of the electronic versions below
you should read our statement on
for viewing Postscript files and the
Acrobat Reader for viewing and printing pdf files.
Full text versions of the paper:
- This paper is published as:
Lundborg, Per and Calin Rechea, (2003), 'Will Transition Countries Benefit or Lose from the Brain Drain?', International Journal of Economic Development, Vol. 5, No. 3
Questions (including download problems) about the papers in this series should be directed to Sune Karlsson ()
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Design by Joachim Ekebom