Does Brain Drain Lead to Institutional Gain?

The World Economy, 2017

36 Pages Posted: 7 Nov 2013 Last revised: 21 Sep 2017

See all articles by Xiaoyang Li

Xiaoyang Li

Deakin University

John McHale

National University of Ireland, Galway (NUIG)

Zhou Xuan

Indiana University Bloomington - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: November 5, 2013

Abstract

A country’s endowment of human capital can affect its institutions through various channels. This raises the possibility that skilled emigration can leave its mark on a country’s institutional development. We combine recent datasets on emigrant stocks and institutional quality to explore the impacts of mobile human capital on home country’s institutional quality. Using geography-based instruments for emigrant human capital, we find that larger emigrant human capital stocks (as a share of domestic population) are associated with higher quality of political institutions, but lower quality of economics institutions.

Keywords: emigration, institution, human capital

JEL Classification: F22, O4

Suggested Citation

Li, Xiaoyang and McHale, John and Xuan, Zhou, Does Brain Drain Lead to Institutional Gain? (November 5, 2013). The World Economy, 2017. Available at SSRN: https://ssrn.com/abstract=2350203 or http://dx.doi.org/10.2139/ssrn.2350203

Xiaoyang Li (Contact Author)

Deakin University ( email )

75 Pigdons Road
Victoria, Victoria 3216
Australia

John McHale

National University of Ireland, Galway (NUIG) ( email )

University Road
Galway, Co. Kildare
Ireland

Zhou Xuan

Indiana University Bloomington - Department of Economics ( email )

Wylie Hall
Bloomington, IN 47405-6620
United States

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