Ethics in Brain Drain

1. BRAIN DRAIN
Submitted By:
14BCL047
14BCL060
14BCL061
14BCL062
14BCL128
14BCL129

2. INTRODUCTION
By “brain drain” we mean the international mobility of people with higher
(tertiary) education – an elite in developing countries (about 5% of the
workforce)
Numbers: by 2000 there were 180 million migrants worldwide, half of them
residing in OECD countries. Of these 90 million migrants, 60 million were
aged 25 or more and can be split more or less equally across education
levels (primary, secondary, tertiary).
Skilled migrants in OECD countries come from Africa (7%), Asia (35%), Latin
America (18%), Eastern Europe (8%) and from other OECD countries (32%).

3. CAUSES
1. General rise in educational attainments in developing countries (induces a
mechanical rise even if migration propensities are constant across education
levels)
2. Globalization tends to increase positive self-selection (skilled people
agglomerate where human capital is already abundant, rising skill premium in
some countries – especially the US); however migration networks are a counter-
acting force
3. Selective immigration policies since the 1980s: point-systems in Australia,
Canada et now in the UK, H1-B Visas in the US, German Green Card, European Blue
Card, French “immigration choisie”.

4. TYPES
Organizational: The flight of talented, creative, and highly qualified employees from
large corporations—e.g. Yahoo, HubSpot, and Microsoft— that occurs when
employees perceive the direction and leadership of the company to be unstable or
stagnant, and thus, unable to keep up with their personal and professional ambitions.
Geographical: The flight of highly trained individuals and college graduates from their
area of residence, for instance, those migrating from the mid-western United States to
the coastal states and large metropolises.

5. Industrial: The movement of traditionally skilled workers from one sector of an industry
to another. For example, jobs in the United States and other governments, also known as
the public sector, have experienced significant generational brain drain as tenured
boomer generation employees retire. Heightened competition for talent from the private
sector and budgetary constraints have made it increasingly difficult to attract
replacements for these retirees.
As with other human migration, the social environment is considered to be a key reason
for this population shift. In source countries, lack of opportunities, political instability or
oppression, economic depression, health risks and more contribute to brain drain,
whereas host countries usually offer rich opportunities, political stability and freedom, a
developed economy and better living conditions that attract talent. At the individual
level, family influences (relatives living overseas, for example), as well as personal
preferences, career ambitions and other motivating factors can be considered.

6. HISTORICAL EXAMPLE
Neoplatonic academy philosophers move After Justinian closed the platonic Academy in
AD 529, according to the historian Agathias, its remaining members sought protection
from the Sassanid ruler, Khosrau I, carrying with them precious scrolls of literature,
philosophy, and to a lesser degree, science. After the peace treaty between the Persian
and the Byzantine empires in 532 guaranteed their personal security, some members of
this group found sanctuary in the Pagan stronghold of Harran, near Edessa. One of the
last leading figures of this group was Simplicius, a pupil of Damascius, the last head of
the Athenian school. The students of an academy-in-exile may have survived into the
ninth century, long enough to facilitate the Arabic revival of the Neoplatonist
commentary tradition in Baghdad

7. ETHICAL CONCERNS

9. HOW BIG IS BRAIN DRAIN?
Docquier, Lowell and Marfouk (World Bank, 2005): use
immigration data from all OECD countries to compute emigration
rates by education level for about 180 countries in 1990 and
2000.
Results:
Population sizes. Emigration rates decrease with country size, are
7 times higher in small countries (10% and 25% for total and
skilled emigration).
Income levels. Middle income countries have the highest total
and skilled emigration rates, but the selection bias is highest (12!)
in poor countries.

10. BRAIN DRAIN IN CHINA
With rapid GDP growth and a higher degree of openness towards the rest of the world,
China has been facing brain drain. A popular Internet writer recently caused a stir when
he asserted that “all Chinese who earn more than 120,000 yuan ($17,650) a year want
to immigrate [sic].” There has been an upsurge in Chinese emigration to Western
countries—particularly the United States, Canada and Australia—since about 2005.
China became the biggest worldwide contributor of emigrants in 2007. According to
the official Chinese media, 65,000 Chinese last year secured immigration or permanent
resident status in the United States, 25,000 in Canada and 15,000 in Australia. The
largest group of emigrants consists of professionals and experts with a middle-class
background, who are the backbone for the development of China. As the biggest
contributor of emigrants, China also suffers the worst brain drain in the world,
according to a new study that found seven out of every ten students who enroll in an
overseas university never return to live in their homeland.

11. POSITIVE EFFECTS
• Provides rewarding opportunities to educated workersnot available at home.
• " Inflow of remittances and foreign exchange
• " Induced stimulus to investment in domestic educationand individual human capital
investments
• " Return of skilled persons increases local human capital,transfer of skills and links to
foreign networks
• " Technology transfer, investments by diasporas" Circulation of brains promotes
integration into global markets (India, Taiwan, (China)).
• " Short term movements of service providers (GATS Mode 4) generate benefits for
both receiving and sending countries.
• " ICT allows countries to benefit from diasporas

12. NEGATIVE EFECTS
• Net decrease in human capital stock, especially thosewith valuable professional
experience
• " Reduced growth and productivity because of the lower stock of human capital
• " Fiscal loss of heavy investments in subsidized education
• " Remittances from skilled migration may taper off.
• " Reduced quality of essential services of health and education
• " Students educated at government expense or ownresources in foreign countries
imply further drain
• " Opportunities for short-term movement of naturalpersons is seriously constrained
by immigration policiesof developed countries.
• " Causes increasing disparities in incomes in country of origin.

13. BALANCED FLOW POLICY OPTIONS ‘6 R’S
Return of migrants to their source country
Permanent return focus of most policies
Restriction of international mobility
Restrictive emigration/immigration policies (explicit and e.g. national trades)
Recruitment of international migrants
Court foreign workers (tax incentives, simplified visa regimes)
Reparation for loss of human capital (tax)
Compensate source countries, or emigrants directly submit taxes, to deal with externalities created by the immediate loss of
human capital
Resourcing expatriates (Diaspora options)
Significant resource, if ongoing contact between academic and private sector institutions is fostered. Government and private
sector initiatives seek to increase communications, knowledge transfer, remittances, and investment.
Retention though educational sector policies
Creating a highly educated workforce begins with strengthening domestic educational institutions. A viable system that
encourages graduates to stay with the system, that retains people, ensures that the source country keeps its original
investment.
Retention through economic development
Giving people a reason to stay (or return) is doubtless the most effective policy for reducing emigration and the surest long-
term means of boosting average human capital, as well as economic growth.

14. CONCLUSION
In assessing the usefulness of brain drain, it is important to understand that for some
of the world’s developing countries "the gains from migration accrue neither from
migrant remittances nor do they return home with amplified skills acquired
abroad". The gains come instead from the increase in promotion of education of
highly skilled labour in developing countries, as well as investment in infrastructure.
Nonetheless there does exist a vast "remittance economy worldwide worth $510
billion in 2007".