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

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

The new economics of the brain drain

For nearly four decades now, the conventional wisdom has been that the migration of human capital (skilled workers) from a developing country to a developed country is detrimental to the developing country. However, this perception need not hold. A well designed migration policy can result in a “brain gain” to the developing country rather than in just a “brain drain” from it, as well as in a welfare increase for all of its workers - migrants and non-migrants alike - as new research suggests.migration; human capital formation; externalities; social welfare

Integration, social distress, and policy formation

I study the integration of regions in the form of a merger of populations, which I interpret as a revision of people's social space and their comparison set; I illustrate the way in which a merger can aggravate social distress; and I consider policy responses. Specifically, I view the merger of populations as a merger of income vectors; I measure social distress by aggregate relative deprivation; I demonstrate that a merger increases aggregate relative deprivation; and I show that a social planner is able to reverse this increase by means of least-cost, post-merger increases in individual incomes, but is unable to counter it by relying exclusively on a self-contained income redistribution that retains individual levels of wellbeing at their pre-merger levels. --integration of regions,merger of populations,revision of social space,aggregate relative deprivation,social distress,policy responses

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

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.The New Economics of the Brain Drain, Policy formation, Labor and Human Capital, Political Economy,

"On a Variation in the Economic Performance of Migrants by their Home Country's Wage"

Although the economic performance of migrants in the receiving country undoubtedly depends on qualifications, it is also affected by inclinations. Given the probability of return migration, a behavioural link is established between the incentive of migrants to save in their country of destination and the prevailing wage rate in their home country. It is shown that migrants coming from a low-wage country optimally save more than migrants from a high-wage country. Policy and research implications suggested by this savings behaviour are alluded to.no keywords

Siblings, Strangers, and the Surge of Altruism

We demonstrate how altruism can surge in a population of nonaltruists. We assume that each individual plays a one-shot prisoner's dilemma game with his or her sibling, or with a stranger, and that the probability that an individual survives to reproduce is proportional to his or her payoff in this game. We model the formation of couples and the rule of imitation of parents and of nonparents. We then ask what happens to the proportion of altruists in the population. We specify a case where the unique and stable equilibrium is one in which the entire population will consist of altruists.Evolution of altruism, One-shot prisoner's dilemma game, Siblings and strangers

Casting the naturalization of asylum seekers as an economic problem

The asylum seekers who choose the level of investment in the host-country-specific human capital, and the government of the host country that chooses the probability of naturalization are modeled as optimizing economic agents in a setting not of their choosing.The probability of naturalization; Investment in host-country-specific human capital; Economic behavior of asylum seekers; Economic behavior of the government of the host country; Stackelberg game

Cooperation and Wealth

We calculate the equilibrium fraction of cooperators in a population in which payoffs accrue from playing a single-shot prisoner’s dilemma game. Individuals who are hardwired as cooperators or defectors are randomly matched into pairs, and cooperators are able to perfectly find out the type of a partner to a game by incurring a recognition cost. We show that the equilibrium fraction of cooperators relates negatively to the population’s level of wealth.Equilibrium fraction of cooperators, Population's level of wealth, Single-shot prisoner's dilemma game

Policy responses to a dark side of the integration of regions

In his paper I study policy responses to an increase in post-merger distress. I consider the integration of regions as a merger of populations which I view as a revision of social space, and I identify the effect of the merger on aggregate distress. The paper is based on the premise that the merger of groups of people alters their social landscape and their comparators. Employing a specific measure of social distress that is based on the sensing of relative deprivation, a merger increases aggregate distress: the social distress of a merged population is greater than the sum of the social distress of the constituent populations when apart. In response, policies are enacted to ensure that aggregate distress and/or that of individuals does not rise after a merger. I consider two publicly-financed, cost-effective policies designed so as not to reduce individuals' incomes: a policy that reverses the negative effect of the merger on the aggregate level of relative deprivation, bringing it back to the sum of the pre-merger levels of aggregate relative deprivation of the two populations when apart; and a policy that is aimed at retaining the relative deprivation of each individual at most at its pre-merger level. These two policies are developed as algorithms. Numerical examples illustrate the application of the algorithms. --merger of populations,revision of social space,aggregate relative deprivation,societal distress,policy responses

On Marriage and Migration

Marriage, migration and related phenomena such as marital stability, fertility and investment in human capital may be better explained by studying marriage and migration jointly. We thus proceed in this paper to explore the role of migration in obtaining joint labour-market and marriage-market equilibrium. This facilitates identification of several novel and testable hypotheses.no keywords