Must Skilled Migration Be a Brain Drain? Evidence from the Indian Software Industry

32 Pages Posted: 9 Dec 2004

See all articles by Simon John Commander

Simon John Commander

London Business School; IZA Institute of Labor Economics

Rupa Chanda

Indian Institute of Management, Bangalore

Mari Kangasniemi

University of Sussex

L. Alan Winters

University of Sussex; IZA Institute of Labor Economics; Centre for Economic Policy Research (CEPR)

Date Written: December 2004

Abstract

We provide a first empirical attempt at understanding the scale and type of skilled migration from the Indian software sector and the consequences for firms experiencing loss of skilled workers. The paper draws on some unique survey evidence of software firms in India. The results are not generally consistent with an adverse or brain drain story but provide a more nuanced interpretation. Not only has skilled migration taken a variety of firms - including significant temporary migration - but the evidence suggests that the impact of mobility on performance in the sending firms has not been unambiguously adverse. There is some evidence of associated wage pressure at the height of the software boom in the late 1990s. But there is also evidence of a strong supply side response as workers acquired training and entered the sector.

Keywords: skilled migration, software, brain drain

JEL Classification: J31, J61

Suggested Citation

Commander, Simon John and Chanda, Rupa and Kangasniemi, Mari and Winters, L. Alan Alan, Must Skilled Migration Be a Brain Drain? Evidence from the Indian Software Industry (December 2004). IZA Discussion Paper No. 1422. Available at SSRN: https://ssrn.com/abstract=632349

Simon John Commander (Contact Author)

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

IZA Institute of Labor Economics

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

Rupa Chanda

Indian Institute of Management, Bangalore ( email )

Bannerghatta Road
Bangalore, Karnataka
India

Mari Kangasniemi

University of Sussex ( email )

Sussex House
Falmer
Brighton, Sussex BNI 9RH
United Kingdom

L. Alan Alan Winters

University of Sussex ( email )

Sussex House
Falmer
Brighton, Sussex BNI 9RH
United Kingdom

IZA Institute of Labor Economics ( email )

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

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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