In the paper "Do Brain Drain and Poverty Result from Coordination Failures?", we explore the complementarities between high-skill emigration and poverty in developing countries. We build a model endogenizing human capital accumulation, high-skill migration and productivity. In this model two countries sharing the same characteristics may end up either in a "low poverty-low brain drain" path or in a "high poverty-high brain drain" path. After identifying country-specific parameters, we find that, for a majority of countries, the observed equilibrium has higher income than the other possible one. In 22 developing countries (including 20 small states with less than 2 million inhabitants), poverty and high brain drain are worsened by a coordination failure.
The case of Small Islands is further analyzed in the paper "Brain Drain and Economic Performance in Small Islands Developing States."
Picture from Dominica weekly.
If education is the key to development in any knowledge-based economy, then why is Dominica losing so much of its human capital?
Do Brain Drain and Poverty Result from Coordination Failures? , Journal of Economic Growth, 17, 1-26 [with F. Docquier].
Brain Drain and Economic Performance in Small Islands Developing States. In: Andrés Artal-Tur, Giovanni Peri, and Francisco Requena-Silvente (eds): The Socio-Economic Impact of Migration flows. Effects on Trade, Remittances, Output, and the Labour Market, Chapter 6, 123-144, Cham: Springer. [with F. Docquier and M. Schiff].
Although movements of capital, goods and services are growing in importance, workers movements are impeded by restrictive policies in rich countries. Such regulations carry substantial economic costs for developing countries, and prevent global inequality from declining. Even if rich countries are averse to global inequality, a single country lacks incentives to welcome additional migrants as it would bear the costs alone while the benefits accrue to all rich states. Aversion to global inequality confers a public good nature to the South-North migration of low-skill workers. We propose an alternative allocation of labor maximizing global welfare subject to the constraints that the rich countries are at least as well off as in the current ``nationalist" situation. This ``no regret" allocation can be decentralized by a tax-subsidy scheme which makes people internalize the fact that as soon as a rich country welcomes an additional migrant, global inequalities are reduced, and everybody in the rich world is better off too. Our model is calibrated using statistics on immigration, working-age population and output. We simulate the proposed scheme on different sets of rich countries.
An Incentive Mechanism to Break the Low-skill Immigration Deadlock, Review of Economic Dynamics, 18, 593-618 [with F. Docquier]
A synthesis of the conclusions in French: Migration des travailleurs pauvres: une vision mondiale, Regards Croisés sur l'Economie, 8, 2010 (with F. Docquier)