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Remittances and the Brain Drain: Skilled Migrants Do Remit Less
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Remittances and the Brain Drain: Skilled Migrants Do Remit Less

Author

Listed:
  • Niimi, Yoko

    (World Bank)

  • Ozden, Caglar

    (World Bank)

  • Schiff, Maurice

    (World Bank)

Abstract

It has been argued that the brain drain’s negative impact may be offset by the higher remittance levels skilled migrants send home. This paper examines whether remittances actually increase with migrants’ education level. The determinants of remittances it considers include migration levels or rates, migrants’ education level, and source countries’ income, financial sector development and expected growth rate. The estimation takes potential endogeneity into account, an issue not considered in the few studies on this topic. Our main finding is that remittances decrease with the share of migrants with tertiary education. This provides an additional reason for which source countries would prefer unskilled to skilled labor migration. Moreover, as predicted by our model, remittances increase with source countries’ level and rate of migration, financial sector development and population, and decrease with these countries’ income and expected growth rate.

Suggested Citation

  • Niimi, Yoko & Ozden, Caglar & Schiff, Maurice, 2008. "Remittances and the Brain Drain: Skilled Migrants Do Remit Less," IZA Discussion Papers 3393, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp3393
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    References listed on IDEAS

    as
    1. Ça?lar Özden & Maurice Schiff, 2006. "International Migration, Remittances, and the Brain Drain," World Bank Publications - Books, The World Bank Group, number 6929.
    2. Nadeem U. Haque & Se-Jik Kim, 1995. "“Human Capital Flight”: Impact of Migration on Income and Growth," IMF Staff Papers, Palgrave Macmillan, vol. 42(3), pages 577-607, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    migration; remittances; education level; brain drain;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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