International Education and Economic Growth

20 Pages Posted: 28 Apr 2013

See all articles by Jan Bergerhoff

Jan Bergerhoff

University of Bonn

Lex Borghans

Maastricht University - Department of Economics; University of Maastricht - Research Centre for Education and the Labour Market (ROA); IZA Institute of Labor Economics

Philipp Seegers

Maastricht University

Tom van Veen

Maastricht University - Department of Economics

Abstract

In recent years international student mobility increased. While net hosting countries are in a better position to win highly educated students for their labour force, they face the additional cost of providing the education. In much of continental Europe these costs are not levied on students, but are borne by the national tax payers, making them an active topic of debate. Borrowing some fundamental equations from the Lucas growth model, this paper addresses the question whether countries benefit from educating international students. We derive conditions under which international education has a positive effect on economic growth, overall and in each specific country. Based on empirically motivated parameter values to calibrate our two-country model we find that international student mobility increases steady state growth for both countries on average by 0.013 percentage points. A small country that is favoured by the inflows of a larger country could experience an extra growth of 0.049 percentage points. The benefits from international education increase when a country tunes its education and migration policy.

Keywords: international education, economic growth, economics of education

JEL Classification: I25

Suggested Citation

Bergerhoff, Jan and Borghans, Lex and Seegers, Philipp and van Veen, Tom, International Education and Economic Growth. IZA Discussion Paper No. 7354, Available at SSRN: https://ssrn.com/abstract=2257204

Jan Bergerhoff (Contact Author)

University of Bonn ( email )

No Address Available

Lex Borghans

Maastricht University - Department of Economics ( email )

P.O. Box 616
Maastricht, 6200 MD
Netherlands

University of Maastricht - Research Centre for Education and the Labour Market (ROA) ( email )

P.O. Box 616
Maastricht, MD6200
Netherlands

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Philipp Seegers

Maastricht University ( email )

No Address Available

Tom Van Veen

Maastricht University - Department of Economics ( email )

P.O. Box 616
Maastricht, 6200 MD
Netherlands

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