Friday, June 1, 2018

More on migration and brain drain

Recently I linked to, and debated the merits of, an article that emphasized the economic benefits to source countries for migration, and downplayed the negative effects of brain drain.

Here is another article touching a similar topic in the context of Central America.  The findings of this study are that migration from the Northern Triangle countries (Guatemala, Honduras, and El Salvador) is in fact "selective", meaning that those who migrate tend to be better educated than the general populace.  We're not talking doctors and engineers necessarily, but maybe the high school grads from a town where average schooling goes only to sixth grade.  Even so, the study calculates that migration represents a brain drain that represents from 1% to 1.9% of lost GDP in each country.  This is of course recovered many times over in cash terms when you consider that remittances comprise something like 15% of these countries' GDP.  That said, my concern remains, because the loss here is in human capital, while the gain is in cash used for consumption.  So I still worry that, in many cases, out-migration amounts to a country's decapitalizing itself to produce higher short-term income.  This might be even more the case in countries where average educational level of migrants is even higher than in Central America.  There they really are losing doctors and artists and researchers. 

Each bit of human capital lost compounds yearly, because whatever the person who left the country would have produced and built on year-by-year is now lost.  If remittances were used mainly to invest in productive assets and education, it could be worthwhile tradeoff--annually compounded losses of the migrant's human capital, offset by annually growing human and built capital in-country.  But that doesn't seem to be the case in Central America, where most remittances are used for household consumption.

And this article's consideration of the human capital losses from Central American out-migration doesn't even take into account the destabilizing effect on families of having one or both parents leave.

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