Tuesday, June 23, 2009

Brain drain and brain backflow: nothing to do with economic factors

Many less developed countries complain about brain drain, as very talented nationals leave for countries with better opportunities. What are the factors that lead them to leave and, in some cases, to come back?

John Gibson and David McKenzie use the example of Tonga, Papua New Guinea and New Zealand, countries where the brain drain is the highest, and show that, surprisingly, economic factors are not the most important, in particular for the decision to return. Gibson and McKenzie determined over about 30 years who the top students were and tracked them and asked them what made them migrate (more than half of them) and come back (about 30% of migrants). Preferences seem to matter most, for example, topic studied at school, risk aversion and patience for migrants. For return migrants, family and lifestyle matter most. In both cases, economic factors are negligible.

What this suggests is that policies centered on making it economically interesting for the best to stay or come back are useless. Improving career opportunities and government quality is much more important.

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