Brain drain or brain gain: A revisit

Recent literature has turned to the brain gain effect, instead of the brain drain effect, that emigration may bring to a source country. This paper, however, suggests brain drain remains a likely outcome. Suppose that foreign language skill affects an individual productivity when working abroad. A brain drain may occur when the (exogenously or endogenously determined) probability of immigration is large. We also consider the case that the probability of immigration is determined by a signal, and provide a condition under which the individual will under-invest in education, which results in a brain drain for the source country.All correspondence to Donald Lien. The authors acknowledge three anonymous referees for helpful comments and suggestions. Responsible editor: Klaus F. Zimmermann