Brain Drain, Brain Gain, and Economic Growth in China

Human Development Research Paper No. 2009/37

39 Pages Posted: 24 Aug 2009 Last revised: 25 Apr 2013

See all articles by Junjian Yi

Junjian Yi

University of Chicago

Junsen Zhang

The Chinese University of Hong Kong (CUHK) - Department of Economics; IZA Institute of Labor Economics

Wei Ha

United Nations - Eastern and Southern Africa Regional Office

Date Written: August 1, 2009

Abstract

This paper examines the effects of both permanent and temporary emigration on human capital formation and economic growth of the source regions. To achieve this end, this paper explores the Chinese provincial panel data from 1980 to 2005. First, the fixed effects model is employed to estimate the effect of emigration on school enrollment rates in the source regions. Relative to this aspect, we find that the magnitude (scale) of permanent emigrants (measured by the permanent emigration ratio) is conducive to the improvement of both middle and high schools enrollments. In contrast, the magnitude of temporary emigrants has a significantly positive effect on middle school enrollment but does not have a significant effect on high school enrollment. More interestingly, different educational attainments of temporary emigrants have different effects on school enrollment. Specifically, the share of temporary emigrants with high school education positively affects middle school enrollment, while the share of temporary emigrants with middle school education negatively affects high school enrollment. Second, the instrumental variable method is applied to estimate the effect of emigration on economic growth within the framework of system Generalized Method of Moments (GMM). The estimation results suggest that both permanent and temporary emigrations have a detrimental effect on the economic growth of the source regions. Our empirical tests provide some new evidence to the "brain drain" debate, which has recently received increasing attention.

Keywords: Brain drain, human capital, emigration, economic growth

JEL Classification: J22, J24, O12, O15

Suggested Citation

Yi, Junjian and Zhang, Junsen and Ha, Wei, Brain Drain, Brain Gain, and Economic Growth in China (August 1, 2009). Human Development Research Paper No. 2009/37, Available at SSRN: https://ssrn.com/abstract=1458970 or http://dx.doi.org/10.2139/ssrn.1458970

Junjian Yi

University of Chicago ( email )

Junsen Zhang

The Chinese University of Hong Kong (CUHK) - Department of Economics ( email )

Shatin, N.T.
Hong Kong
852-2609-8186 (Phone)
852-2603-5805 (Fax)

HOME PAGE: http://www.cuhk.edu.hk/eco/staff/jszhang/jzhang.htm

IZA Institute of Labor Economics

P.O. Box 7240
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Germany

Wei Ha (Contact Author)

United Nations - Eastern and Southern Africa Regional Office ( email )

United Nations complex Gigiri
P.O. Box 44145
Nairobi, 00100
Kenya

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