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Grossmann, Volker ; Stadelmann, David:
Does international mobility of high-skilled workers aggravate between-country inequality?
In: Journal of Development Economics.
Bd. 95
(2011)
Heft 1
.
- S. 88-94.
ISSN 0304-3878
DOI: https://doi.org/10.1016/j.jdeveco.2010.04.007
Abstract
This paper analyzes the interaction of international migration of high-skilled labor and relative wage income between source and destination economies of expatriates. We develop an overlapping-generations model with increasing returns which suggests that international integration of the market for skilled labor aggravates between-country inequality by harming those which are source economies to begin with while benefiting host economies. The result is robust to allowing governments to optimally adjust productivity-enhancing investments which could potentially attenuate brain drain. Optimal public investment tends to decrease in response to higher emigration.