BRAIN DRAIN

Brain drain: the inclination to stay abroad after studies

Brain drain: the inclination to stay abroad after studies

Introduction

The article under review is “Brain drain: Inclination to stay abroad after studies”, by Yehuda Baruch, Pawan S. Budhwar, and Naresh Khatri.

Review and Analysis

The article evaluates the overall effects of brain drain in developing economies and quantifies the relative size of various static and dynamic impacts. By building a unified framework is characterized by the generic dynamic overlapping generations, and calibrated to actual data, this study incorporates many direct impacts of brain drain whose interactions along with other indirect effects, is generated dynamically and endogenously (Yehuda¸2007).

Is brain drain a curse or a blessing for the countries of origin? In the survey conducted by the authors, the different forces at work are discussed and several possible positive and negative effects of skilled emigration are reviewed, they conclude by suggesting that "more research is needed to clarify the relevant magnitudes."

To study the global effects of brain drain in developing economies and to quantify the relative size of various static and dynamic impact, a generic framework is, undoubtedly, be able to incorporate the main mechanisms identified in the literature. With this objective, we developed a ten-region general equilibrium model is characterized by overlapping generations (OLG) the dynamics and calibrated with real data. We evaluated the impacts of the output of skill with three economic indicators: Gross Domestic Product (GDP) per capita gross national income (GNI) per capita and income inequality qualified to less qualified.

In that context, not only can we juxtapose the direct impacts of brain drain, but their interactions and other indirect effects are also produced endogenously and dynamically. This is a very important step, as skilled emigration is not an isolated incident, but the waves throughout the global economic system. In the process of economic globalization, the international movement of factors of production is an essential component that stimulates greater global economic integration (Yehuda, 2007).

On the one hand, financial liberalization and international arbitration practice contribute to the major cross-border capital flows. While the amount of foreign direct investment (FDI) worldwide has increased from 13.346 million in 1970 to 1,833,324 million in 2007 (measured in U.S. dollars at current prices), increased per capita FDI is much more significant in developed economies alias of "North", the alias of the developing economies of the South. "

Author's conclusions suggest that short-term impact of brain drain on human capital resident is very important because not only determine the number of skilled workers available for domestic production, but also affects the ability of the economy Shipping to innovate or to adopt modern technologies. The impact of the latter plays a particularly important role in a global economy where capital investment is made in places with greater efficiency in production, ceteris paribus. Therefore, despite several empirically documented the positive feedback effects, countries with high rates of emigration of skilled workers are the most sincere victims of brain drain, as they are less likely to benefit from "brain gain ', ...