1.
EC 62 Research Paper (Title TBA)
Praz Perkasa
prastama.perkasa@tufts.edu
732­407­9733
EC 62 Economics of International Migration
Professor. Anna Hardman
Abstract
Since 1980s, China has been struggling to find the necessary policies to ensure the return of
their highly skilled citizens from abroad, who are comprised of mainly scholarly academics and
researchers.This paper will try to answer the enigmatic phenomenon of why high­skilled migrants are
hesitant to return to China even when there are huge incentives from the Chinese government. The paper
will draw data from NBS and IIE to show that China is indeed experiencing brain drain. Then, the
paper will summarize past policies and programs that China has implemented, arguing that it is not
effective because it only focuses on a person’s economic well being. Finally, the paper will propose a
new policy model that consists of two parts: (a) government involvement in macro changes and (b)
diaspora approach. Macro changes will require government to create a safe, productive and supportive
working environment, the establishment of new sectors and the option to leave. In the long run, China
should try to be self­sufficient in providing higher education that is comparable in quality with the U.S.
The diaspora approach, on the other hand, will require the establishment of a worldwide permanent
communication, joint projects and mission and the creation of parallel labs. The long run goal of
diaspora approach is to establish and expand both international and new businesses in China.
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2. Introduction
In the past decade, an increasing number of highly skilled citizens of developing have been
traveling to work abroad. The cumulative total of Chinese students overseas, for example, has
quadrupled since 2000. Consequently, China has been struggling to find the necessary policies to ensure
the return of their highly skilled citizens from abroad, who are comprised of mainly scholarly academics
and researchers. The fundamental reality is that all countries, regardless of their development, need
human capital to ensure innovation by building institutions and programs for further economic growth
(Kapur & McHale 2005). While rich countries want to acquire the brightest and most highly skilled
workers, poor countries want to retain their best and brightest people (The Economist 2011). This
ongoing ‘talent war’ or human capital flow can be categorized within two categories: brain drain and
brain gain. Brain drain is the outflow of highly skilled workers that may hinder productivity and
economic growth of the sending country. On the other side, brain gain is an increase in the number of
highly skilled worker entering a country. The magnitude of the effects of brain drain and brain gain has
long been noted by prominent economists, such as Jagdish Bhagwati and Cong Cao. Since the number
of highly educated immigrants living in developed countries increased by 70% during the 1990s, brain
drain became a major concern for developing countries (Croix and Davis 2012).
Among many developing countries, China has been experiencing a particularly significant brain
drain, especially at the higher end of education level. Between 1978 and the end of 2007, more than
12.1 million Chinese went abroad for research and study purposes, and only a quarter have returned
(Cao 2008). China’s biggest challenge is in fact bringing back the very best scientists and academics.
Many economists have long been focusing on China’s emigration because the Chinese government has
been the most assertive government in the world regarding efforts to reduce brain drain (Wang and
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3. Zweig 2013). China’s realization of the global talent war has been critical in facilitating immigration
policies aimed at enhancing China as an economic and scientific power (Wang and Zweig 2013). With
China’s realization, the government has played a major role in facilitating the return flow of human
capital. In the past, the Chinese government has provided incentives for high­skilled migrants, in
particular returnees with scientific and medical backgrounds. Such incentives include the guarantee of
entering the labor market, access to prime housing and opportunities to apply for research funding
(Tyson 2011). But even with these appealing incentives, top academics are still hesitant to return at a
time when China is in desperate need of talents to make itself an innovation­oriented society (Cao
2008). An important question to explore is why top academics are hesitant to come back even with
such appealing incentives.
This paper will explore various literatures on the effects of brain drain in China and the
incentives that China created to bring high­skilled migrants back. This paper begins with the
determinants of human capital flows that drive migration of highly skilled workers. Then, this paper will
discuss the different policies that China has implement and why it was not successful. The paper will
argue that Chinese government is putting too much focus on the income maximization of individuals,
rather than the utility maximization. The Chinese government fails to understand that many migrants are
not returning due to political instability and having to adapt to a new work culture. High returns on
human capital, or income maximization, are just a small part of utility maximization. This paper argues
that China has been experiencing brain drain by using macro data and aggregate flows, exploring
policies that China needs to restrict certain migration flows. The paper will then discusses the different
factors that attract migrants to return back to China on a permanent basis, specifically the different types
of policies that China need to implement.
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4. Evidence of Brain Drain in China and its Effects
China has become one of the top countries for human resources in the world (Shen 2013).
China has been sending students to study abroad in the US since 1978. Since then until 2007, 1.2million
Chinese students have moved overseas and only 319,700 million of them returned to China by 2012,
representing a 26.38% return rate according to the Ministry of Education (MOE, Table 3). Data shows
that the longer the talented individuals stay abroad, the less willing they are to return to China (Yuchen
2013). The ratio of returnees to departing students has also been decreasing in recent years. In 1984,
the ratio of returnees to departing students was 54.04%, compared to 2006, which was 25.09% (Table
2). Similarly, the rate of return from the MOE stock data has been around 25% in recent years. Another
important statistic from the MOE is that for each of the past 17 years, Chinese had accounted for 10%
of the international student body in the US, with more than 80% in graduate programs (Table 1). This
data shows that Chinese nationals who choose to stay in the US are mostly academics and doctorates.
This paper is most concerned about the brain drain of Chinese doctorates and researchers.
According to recent statistics from US National Science Foundation (NCS), there are some 62,500
Chinese by birth who hold a PhD degree in science and engineering in the workforce in the U.S. Half of
them have become US citizens and 17,000 have permanent residency status (NSB 2006). Excluding
permanent residency and US citizens, there is only a 27.8% potential return rate of Chinese doctorates
and researchers. A recent report by Bain & Co revealed that 60% of Chinese citizens with a net worth
of $1.5 million or more wanted to emigrate, and 33% of them already have investments abroad. China’s
brain drain on researchers and doctorates lead to the lack of innovation. For a country representing
such a huge portion of the global economy, China only ranks 34th
of 141 countries listed on the 2012
Global Innovation Index (GII). Consequently, China is experiencing a “talent deficit” that will hurt its
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5. economic growth in the long run. By depriving developing countries of human capital, one of their most
valuable resources, brain drain can be seen as a drag on economic development (Docquier et al 2007).
Determinants of Human Capital Flow
This paper will discuss three noteworthy determinants of human capital flow; (a) political
stability, (b) institutional and government support and (c) high return rate of high­skilled labor along with
occupational prestige. These determinants compromise the push and pull factors that drive Chinese
doctorates and researchers to emigrate. Political instability in the host country compared to the receiving
country can be a major push factor for high­skilled citizens. Political instability can affect the institutional
support that is currently given to researchers. One example of what political instability can lead to is riot
and protest. These actions can affect the well­beings of researchers who are trying to innovate. Riots
can also close institutions, which would in turn lead to a decrease of institutional support for research. It
is very important for researchers and doctorates to be in a politically stable environment because most
research is supported through subsidies from government and specific institutions. People are also
attracted to democratic countries that encourage free competition, individual choice in education and
career and laws that protect innovation. One example is after the Communists gained control of Eastern
Europe in the late­1940s, many people immediately chose to immigrate to democratic countries such as
those of North America. Another push factor of political instability is the fear of prosecution and the
possibility of becoming a refugee. Due to such concerns, people migrate to politically stable countries to
avoid the consequences that political instability can inflict. Most even believe that the choice to remain in
America reflects the ‘pull’ of democracy and the ‘push’ of political repression and Communism in China
(Zweig and Chen 1998).
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6. The second determinant is institutional and government support. This determinant plays a
significant role in the migration of doctorates and researchers. Researchers need to be in a supportive
environment so that they can innovate. Researchers are typically very concerned with the support that
they receive from institutions and government. The United States provides outstanding incentives for
researchers and innovators through patents, copyrights and trademarks. The reason that the U.S. is
ranked very highly regarding its levels of innovation is because the work of entrepreneurs is protected
by strict and reliable laws. With the support of the government, the well­beings and utility of researchers
will be better and they will stay in that particular country. Highly skilled workers were found to be far
more responsive to economic push­pull factors when compared to low skilled workers, especially
regarding the relationships between highly skilled workers, institutions, and the government (Docquier
and Croix 2012). With the existence of institutional support, researchers can have access to technology
that can improve their productivity. Without any financial support, a researcher would not be able to
conduct the appropriate research. This often leads to migration to a country that has better institutional
and government support to further conduct their research.
The third determinant is the high return rate of highly skilled labor along with occupational
prestige. Known as economic incentives, this determinant provides the greatest push and pull factors for
potential migrants. Many people found that the work or human capital in developed countries is
rewarded with higher wages. Developed countries also provide a better safety net through welfare
benefits, such as employment and insurance. Migrants are drawn to these incentives so that they can
maximize their incomes, utility and ultimately their well­beings. Certain occupations, such as researchers
and IT are given more prestige in developed countries. Developed countries are in a phase where
economic growth is best guaranteed through innovation and producing new technologies. Compared to
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7. developed countries, developing nations see much of their economic growth through agricultural and
manufacturing sectors. Therefore, highly skilled workers receive more substantial occupational
opportunities and prestige in developed countries. People also migrate to places where the resources
available will complement as well as increase a worker’s productivity. A country with valuable natural
resources like Indonesia may attract miners and engineers. A new chemical industry, such as the
Celanese industry, may attract scientists and researchers. Inevitably, better economic opportunities and
the promise of a better life is a huge incentive for people to migrate.
Different Policies that China has Implemented
There have been a lot of arguments regarding if China needs to implement policies aimed at
increasing the return rate of highly skilled migrants or not. The Chinese Communist Party argues that
brain drain in reality stores Chinese brainpower abroad as an investment that will benefit China
eventually (Zweig and Chen 1998). The Chinese government has been playing an active role in
facilitating the flow of human capital by introducing incentives for returnees (Zweig and Wang 2013).
These incentives include higher salaries, better housing and dual passports or even long­term residence
cards.
The prominent work by Cong Cao on China’s brain drain at the high end has generated
substantial research on the topic of policies that China has implemented. Cao argues that in the
mid­nineteenth century, during the first 30 years of Communist rule, China did not experience a shortage
of high­skilled workers in its economics, education and even scientific sectors. It was only after the
opening up of China in 1978 that one million Chinese had the chance to go abroad. After the Cultural
Revolution of 1976, the Chinese government admitted to China’s lack of young and middle­aged
scientists and academics. In 1978, leader Deng Xiaoping suggested that China send students abroad for
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8. higher education in the science and technology industry. Deng implemented an open door policy,
allowing Chinese nationals to come and go as they wish. Deng argued against the damage of brain drain
by saying that even if 100 of the 1000 students sent did not return, there would still be 900 left.
However, the 1989 Tiananmen Square crackdown on students and the political instability in China
forced the U.S. Congress to pass the Chinese Student Protections Act in 1992. This act allowed
Chinese nationals in the U.S. to stay for extended periods, work, and obtain permanent resident status.
This event was devastating for Xiaoping’s open door policy because many highly qualified Chinese
nationals in the US chose to remain there.
Soon after this unexpected event, China imposed restrictions on the open­door policy. One
restriction is that only those who fulfill a certain number of years of service to the country would be
allowed to go abroad. Through such restrictions, it was hoped that graduates would lose interest in
studying abroad or that foreign universities would be reluctant to accept students who are not freshly
graduated. This restriction also provided a chance for Chinese students to settle in China by
discouraging them to move to another country. After realizing that this new rule was not successful in
increasing the number of scientists and academics in China, CCP Central Committee General Secretary
Jiang Zemin mentioned that it was not only impossible but also unnecessary for China to attract all of its
overseas students back. He argued that Chinese abroad tend to send back money through remittances,
which makes them among China’s greatest assets in the long run.
Towards mid­1990s, Chinese government officials began to realize the serious implications of
brain drain and their lack of scientists and doctorates. Since that acknowledgement, the government has
been implementing more programs that incentivize scientists and doctorates abroad to return. One of the
earliest programs was the “One Hundred Talents” program, implemented at the Chinese Academy of
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9. Sciences in 1994. Its mission was to recruit scientists abroad who are under the age of 45, with a
monetary offer of $240,000 for a three­year stay in China. This includes money for research, a housing
subsidy, and a moderate salary. This program was a success, as 839 scholars joined it; 95% them have
foreign study experience, and 621 came directly from abroad.
In 1994, the Natural Science Foundation of China (NSFC) created the National Science Fund
for distinguished young Chinese scholars. The fund provides support to promising scientists under the
age of 45 in seven scientific fields, including math, physics, chemistry, and life science. This program is
exclusively geared towards scientists and doctorates that are in the science field. The economic incentive
is based on a three­year period, with awardees receiving $72,000. Half of that amount is be designated
for technological sciences and theoretical research. With these incentives, NSFC’s mission is to increase
innovation and research in the science field. Because of its success, by 1998 the National Science
Fund’s budget reached nearly $21.7 million. The fund has given awards to 1,200 young scientists, with
more than 80% of the scientists having foreign study or research experiences.
In 1995, China administered a program called “Hundred, Thousand and Ten Thousand Talents
Programme” in conjunction with the Ministries of Science and Technology, Education, and Finance, the
State Development and Planning Commission, the NSFC, and the China Association of Science and
Technology. The program was intended to reach its goal by 2010. The goal was to produce outstanding
Chinese researchers; one hundred would be exclusively active in the research frontier of world science
and technology, a thousand would have advanced knowledge to lead development of academic
disciplines, and ten thousand would be disciplinary leaders in reserve with high academic attainments.
The program aimed to make China self­sufficient in the innovation of new technological breakthrough.
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10. In 1998, China launched its most recent program, called the “Cheung Kong Scholar
Programme.” This program awards outstanding middle­aged and young scientists, especially those from
abroad and who are active in the international research arena, by appointing them to teach at Chinese
universities. The program aims to improve the higher education quality in China so that Chinese students
would prefer to stay in China rather than going abroad for study purposes. It also gives young and
middle­aged scientists economic incentives to return by providing guaranteed jobs in Chinese
universities. As of 2008, there have been eight rounds of recruitment, resulting in the endowment of 800
positions. The Chinese government also put aside special funds to highly­skilled Chinese nationals
abroad who would like to contribute to China but cannot work full­time in the country. The Cheung
Kong Programme, for example, recruited 300 professors to work in China temporarily for research or
teaching purposes.
Other than these incentivized programs, the government has attempted to adjust China’s legal
system to deter skilled workers from emigrating. One such law is China’s “Five Years Work” rule,
which attempts to keep workers living in China for at least five years.
Analyzing The Policies that China has Implemented
The policies that China has been implementing have been geared towards income maximization
rather than utility maximization. The Chinese government has not succeeded, however, in bringing back
the very best scientists and academics. In order to explain the flaws of these policies, it is important to
know the variables that predict Chinese academics’ and scientists’ returns to China. These variables
include the initial intentions of the individuals prior to departing their host countries, expectations about
political and social stability in China, and the person’s well being. The policies that China has been
implementing only focus on a person’s economic well being. They fail to address the concerns of
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11. political and social stability in China. The programs that China has implemented are only targeting a
specific group of scientists and academics. These scientists are usually the ones who do not have family
abroad and would be willing to return to China because they have not assimilated into their receiving
countries. These programs also target scientists and academics who prioritize income maximization
rather than utility maximization.
First­rate academics have not returned also because the salary for academics in China tends to
be low even with the financial incentives provided by the programs. Furthermore, an outstanding
bilingual education in China is so expensive that many academics cannot afford to provide good
education for their children. Another problem is if there are family members of returnees abroad. This
will require returnee to travel back and forth while facing the challenges of communication with their
family members abroad. More importantly, there are institutional factors that explain why first­rate
academics have not returned to China. First, the success of a career in China is based upon connections
rather than intelligence (Cao 2008). If Chinese academics graduated from a university in the United
States, it is very probable that they have better connections in the U.S. Second, when doctorates and
academics have spent considerable time overseas their connections with local institutions in China are
weakened. When this happens, they often experience a culture shock once returning to work in China,
as they need to build on their connections with local institutions to gain support.
Furthermore, The programs and policies that China has implemented fail to address the various
restrictions for research in the social sciences. Many academics in China are arrested for conducting
research on sensitive issues. There is also no free speech in the media, which makes it very difficult for
researchers to publish their research and get rewarded for their work. By returning back to China,
returnees have to adapt and adjust to a different research environment by setting up a laboratory,
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12. forming a team, and recruiting students, among other tasks. In some extreme cases, these returnees
might experience in a decrease in their well beings and utility because of frustration dealing with the
different rules of the “game” played in China. They might not have anyone to trust and talk about these
rules because they have no connections in China. Because of such challenges, young Chinese
researchers often prefer to stay abroad if they are given the the opportunity.
There has also been a lot of behavioral misconduct in the Chinese research field of science,
including plagiarism, falsification of data, conflict of interests. These kinds of misconduct behaviors have
affected the image of Chinese scientific community negatively, which has added to the hesitance of
academics and researchers abroad to return. There is also a lamentable conflict of interest between the
government and local institutions in China. While the government wants the return of the best and the
brightest, leaders of local institutions might not accept more capable and intelligent people, as they may
perceive them as adding competition. From the perspective of many emigrant researchers and
academics, there are a lot of barriers, low efficiency, personal conflicts, and many miscellaneous risks
tied to returning back to China.
To try to compensate for brain drain, the Chinese government has played an active role in
limiting students from study abroad. For example, it has limited civilian access to the TOEFL test,
required by many institutions of students desiring to study abroad. The government additionally
promotes study areas that would increase the likelihood of return by more directly linking educational
achievement to career opportunities in China. A psychoanalytical predictive test is even implemented on
students; the government allegedly only sponsors those who the test predicts are most likely to return
(Tyson 2011). Since targeted returnees are mainly from scientific and medical backgrounds, the national
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13. government has been collaborating with provincial and state officials to establish open laboratories to
provide more career opportunities for returnees.
Proposing a New Policy
The policy that is about to be proposed will consists of two parts: (a) government involvement in
macro changes, and (b) diaspora approach. While macro changes are geared towards long run
changes, diaspora approach is short­run that requires the Chinese government to work with other
institutions such as United Nations. Diaspora approach is relatively inexpensive, and it allows Chinese
migrants abroad to contribute back to China without having to return. Macro changes are required
because the return of many Chinese migrants, especially doctorates and scientists, most likely depend
on the internal political situation. Macro changes will attract high­skilled returnees and this policy will
focus on three different aspects. The first aspect is China’s rapid economic development, because it acts
as a demand for researchers, academics and scientists. The second aspect is to increase political
stability and faith in the government. The third aspect will focus on giving returnees the option to return
to the host country, if they cannot fully assimilate back China. This also means, however, that
government agencies must be highly structured, updating lists of expatriates abroad to maintain
communication.
The Chinese government needs to create a productive, safe, and efficient environment in order
to attract researchers and academics. The most fundamental elements of such policy include property
rights, transparent government, lack of corruption and other good properties of governance. In order to
increase innovation and the return of entrepreneurs, the government needs to increase market
opportunities and the confidence of entrepreneurs abroad by demonstrating that the private sector is the
core component of the national economy. It is necessary to attract entrepreneurs for the proliferation of
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14. industries in different private sectors of the market. After the establishment of such sectors, China can
then attract scientists and even academics to work on these newly established sectors. By increasing the
supply side of researchers and academics, the wages of researchers and academics will increase due to
the new equilibrium of supply and demand graph. As more private­sector firms are set up, the negative
aspects of working in China can be eliminated (Zweig 2006).
Another policy that government can implement is the option to leave China. Since many
academics and scientists are afraid of the internal political situation and working conditions in China, the
option to leave would provide more comfort should conditions worsen. Academics and scientists who
have studied abroad are also more likely to return to their homeland if they think that they can fully
assimilate back into the society. With this policy, returnees can decrease the risk of re­assimilating into
Chinese society and try to return to China temporarily with the option of going back abroad if
necessary. This option would not only increase the returnee’s well being, but it will also decrease the
risks in returning back to China. A more open migration policy would open up more choices to
returnees, and this would help maximize the returnee’s utility. With the combination of income
maximization through financial incentives and this option, the returnee could hesitate less about the
political climate and its potential effect on his career opportunities.
In the long run, China should also work towards becoming self­sufficient in providing
high­quality educations for Chinese nationals. Efforts to reduce the out­migration of college graduates
have not proven sufficient; China needs to more effectively restrict access to TOEFL to keep students
at home. Combining these restrictions with the financial incentives, China will be able to create a
high­quality education that can produce scientists, academics and doctorates. Additionally, China should
create an environment that is conducive to foreign direct investment that may attract multinational
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15. companies. These multinational companies can create a supportive environment for expatriates who
wish to return.
The second policy is the diaspora option. This option is to let Chinese nationals stay abroad
with expectation that they would be able to contribute to China’s economic development. The
diaspora’s purpose should be to utilize foreign resources and human capital for China’s economic
benefit. This policy needs to be implemented through a formal, organized, and well­established
institution. One of such institution available is Transfer of Knowledge through Expatriate Nationals, or
TOKTEN, a program of the UNDP. The aim of TOKTEN is to utilize highly qualified human resources
abroad without forcing them to give up their overseas livelihoods.
There are certain strategies that Chinese government, along with TOKTEN, can implement for
the diaspora option to work efficiently and effectively. First, there should be a firm establishment of a
worldwide permanent communication between the overseas Chinese and those at home. There should
be a space where all the Chinese scientists, academics and doctorates abroad can share a common
forum of relevant information. This way, highly­skilled Chinese can have a space where direct and
consistent exchanges of ideas is possible. Second, an autonomous peers’ organization should exist in
order to facilitate this exchange. Chinese abroad should not be exclusively dependent on institutions of
their host countries, but they should create their own independent institutions. Through such institutions,
there would be less government intervention. It is also important that political instability does not affect
these highly­qualified Chinese nationals who are willing to contribute back to their home country.
After the establishment of an independent institution, there should be explicit and distinct joint
projects and mission. The organization should have a definite purpose of work sharing. There should be
a clear vision and goal of the academic, technological and intellectual concrete operation. The first goal
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16. should be that the diaspora community contributes to the mainland through teaching, lecturing or
collaborative research. This community can communicate to institutions in China to help organize
seminars and engage in collaborative research. One organization in China, the Chinese American
Professors/Scholars Network, actually links diaspora communities in the US with Chinese Institutions.
One specific program that they offer is the ‘double base model’ where individuals in the diaspora
community set up parallel labs abroad and in China. The goal is to create collaborative projects
between the two parallel labs in both China and host countries. This program is advantageous to
scientists and researchers abroad because funding is better­facilitated and interdisciplinary projects and
programs can be created easily since Chinese institution directors have more authority and power. Since
China is the world’s second­largest economy, the products that are created through research can have
bigger demand in China.
Another goal of the diaspora option is for Chinese nationals abroad to establish and expand
businesses in China. Through a permanent and well­established communication forum between
highly­qualified Chinese migrants, these migrants can establish a joint hi­tech industry. The key target of
this approach is to strengthen the country’s private sectors through science and education. These kinds
of firms usually develop new and innovative products that could help China compete globally for
talented workers. Chinese abroad are also much more likely than non­Chinese to bring new technology
and innovation back to China. A lot of researchers and academics design new technology abroad, but
inevitably their employers maintain ownership over technology that they helped created. Thus, bringing
their innovation and technology to China would be financially advantageous for them. After all, these
high­skilled Chinese migrants are more familiar with their own country and it is easier for them to
innovate and develop new products. This approach would create financial incentives for Chinese
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17. migrants to make money through their products while China also benefits from the innovation credit and
expertise.
It is important to note that not all diaspora communities consist of high­qualified Chinese migrants. For
example, the overall cohort and education level of Chinese people residing in San Francisco’s
Chinatown and California’s Silicon Valley are understandably very different. The diaspora approach
would be targeted towards diaspora communities that consist of highly­educated Chinese migrants, such
as Silicon Valley. In the article Re­defining the Brain Drain; China’s ‘Diaspora Option’, Zweig
David et al. discuss the diaspora approach using Silicon Valley as an example. In their findings, 19% of
Chinese respondents from Silicon Valley said that they exchange information about technology regularly
with their cohorts in China. Also, amongst people who desire to set up a company or expand in China,
23% regularly exchange information about technology with colleagues in China (Table 4). This means
that the diaspora approach has existed even without government and institutional involvement. This
shows why China should be prioritizing reaching out to its diaspora and that it is possible to create a
better communication space to facilitate the exchange of ideas, collaboration and joint­projects.
Conclusion
Despite the financial incentives that the Chinese government and Chinese institutions have
provided, many of China’s top researchers, academics and doctorates abroad are not prepared to
return home. The longer one stays abroad, the less likely that one will return. Family obligations,
professional connections, and work contracts make returning home very difficult for many overseas
Chinese. It is imperative that the Chinese government realizes that the different aspects of utility
maximization besides income and budget constraints.
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18. By analyzing the different policies and programs that China has implemented, it is clear why
China is still struggling to find ways to incentivize top academics and scientists abroad to return. The
policies that China has implemented has been focusing on a person’s economic well beings, rather than
their utility as a whole. These policies also failed to address the concerns of political and social instability
in China. It is also important to understand the reason why top academics and scientists abroad are not
returning back to China. First of all, China is lacking affordable yet outstanding bilingual education for its
people. Returnees are hesitating to return back also because family ties will be affected. Moreover,
scientists are hesitant to conduct research in China because there are various restrictions in the research
field. There has also been behavioural misconduct in Chinese research field, which is discouraging for
many returnees. As proposed above, the policy model to maximize utility should implement consists of
(a) macro changes and (b) a diaspora approach.
It is vital for Chinese government to establish a productive, supportive and safe working
environment for all returnees. The establishment of technological and chemical sectors are also important
in attracting returnees, particularly top academics and scientists. These new sectors will act as the
demand side of the returnees, which will also increase wage and provide the necessary tools and
technologies for research purposes. Another huge incentive that the policy should include is the option to
leave. This way, returnees can have the chance to re­assimilate in China without making a life­changing
decision in staying permanently in China. This option will not only reduce the risks of not being able to
assimilate successfully, but will also increase the returnees’ well being and utility. In the long run, China
should be a self­sufficient country that can provide education comparable to the United States so that
people would stay in China for higher education purposes.
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19. The diaspora option, in the other hand, stresses the importance of maintaining connections
through a well­established worldwide permanent communication with Chinese nationals abroad.
However, the diaspora option should have a clear objectives, such as joint projects and mission. Such
project can include teaching, lecturing or collaborative research between the Chinese nationals in China
and abroad. This option will also allow different people to build connections that can lead to the
establishment of parallel labs both in China and abroad. This is very advantageous and effective because
Chinese abroad can contribute to China without actually having to move or return back. In the long run,
the diaspora option hopefully can lead to the establishment and expansion of both international and new
businesses in China. These businesses are intended to increase the demand for high­skilled workers
abroad.
With the proposed policy model above, China will be able to attract more returnees. This policy
model requires government to make macro changes in China’s economy, social and political stand.
However, these changes are required for China to get the necessary human capital for innovation and
economic growth purposes. Moreover, this policy model will require China to work alongside with
global institutions such as United Nations. In short, political and social stability, macro changes and
maintaining permanent worldwide communications with Chinese abroad are critical factors that would
encourage people to remain in China and in attracting back doctorates, top academics and scientists
that have left.
Table 1 ­ Source: NBS and Cao (2008)
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20.
Table 2 ­ Source: IIE and Cao (2008)
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21.
Table 3 ­ Source: IIE and Cao (2008)
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