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Policy Repercussions of 'The New Economics of the Brain Drain'

ZEF Discussion Papers on Development Policy No. 145

15 Pages Posted: 18 Dec 2010  

Oded Stark

University of Bonn; University of Warsaw; University of Tuebingen; Georgetown University

Date Written: December 16, 2010


In this paper I delineate novel policy repercussions suggested by my research on “The New Economics of the Brain Drain.” In section 1, I provide a succinct account of the model that inspires the derivation of several new policy implications. In sections 2 through 5, I present the policy implications. I address the following questions: When and how can migration to a country substitute for educational subsidies in that country? Who should be admitted when the receiving country cares about the wellbeing of the unskilled workers who stay behind in the sending country? How and why the incentives to form human capital in the sending country will have a paradoxical effect on the migration policy of the receiving country? How and why will the level of a separating tax imposed by the destination country be reduced by the human capital formation calculus in the sending country? I conclude that the policy implications delineated in the paper illustrate the power and appeal of “The New Economics of the Brain Drain” as a framework for rethinking the formation of sound policy responses to migration.

Keywords: The New Economics of the Brain Drain, Policy formation

Suggested Citation

Stark, Oded, Policy Repercussions of 'The New Economics of the Brain Drain' (December 16, 2010). ZEF Discussion Papers on Development Policy No. 145. Available at SSRN: or

Oded Stark (Contact Author)

University of Bonn ( email )

Walter-Flex-Str. 3
Bonn, NRW 53113

University of Warsaw ( email )

Dluga Street 44/50
Warsaw, 00-241

University of Tuebingen

Wilhelmstr. 19
Tuebingen, Baden Wuerttemberg 72074

Georgetown University ( email )

Washington, DC 20057
United States

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