Unknown Talents and the Brain Drain: The Informational Role of Migration

24 Pages Posted: 1 Aug 2003

See all articles by Pasquale Scaramozzino

Pasquale Scaramozzino

University of Rome II - Faculty of Economics; University of London - School of Oriental and African Studies (SOAS); University of London - Centre for Financial and Management Studies (CeFIMS)

Yasmeen Khwaja

Brunel University London - Economics and Finance

Date Written: August 2003

Abstract

This paper shows that the migration of educated workers abroad can convey a positive signal about the ability of native talents. When there is uncertainty about the distribution of talents in the donor country and/or about the effectiveness of its education system, migrants may reveal information about their talents. This may enhance the reputation of the workforce both in the host country and in the donor country. The brain drain can thus act as an information device. The main possible consequences of the brain drain are: (i) higher investment in human capital by the younger generations; and (ii) higher investment in the domestic economy. The out-migration of talented people could be an essential condition for long-run growth in the donor economy.

Keywords: Brain drain, signaling, technology transfers

JEL Classification: D82, J24, O15

Suggested Citation

Scaramozzino, Pasquale and Khwaja, Yasmeen, Unknown Talents and the Brain Drain: The Informational Role of Migration (August 2003). Available at SSRN: https://ssrn.com/abstract=428583 or http://dx.doi.org/10.2139/ssrn.428583

Pasquale Scaramozzino (Contact Author)

University of Rome II - Faculty of Economics ( email )

Via Columbia n.2
Rome, 00100
Italy

University of London - School of Oriental and African Studies (SOAS) ( email )

Thornhaugh Street
Russell Square: College Buildings 541
London, WC1H 0XG
United Kingdom

University of London - Centre for Financial and Management Studies (CeFIMS)

Thornhaugh Street
London, WC1H 0XG
United Kingdom

Yasmeen Khwaja

Brunel University London - Economics and Finance ( email )

Uxbridge UB8 3PH
United Kingdom

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