@TechReport{iza:izadps:dp11483,
            	author={Schiff, Maurice},
            	title={Beneficial Brain Drain and Non-Migrants' Welfare},
            	year={2018},
	month={Apr},
            	institution={Institute of Labor Economics (IZA)},
            	address={Bonn},
            	type={IZA Discussion Paper},
            	number={11483},
            	url={https://www.iza.org/index.php/publications/dp11483},
	abstract={Though a net brain gain has tended to be seen as a benefit and referred to as a 'beneficial brain  drain'  in  the  literature,  its  welfare  impact  for  source  country  residents - or  non-migrants - is at best ambiguous. Increased educational investment in response to a brain drain  is  equivalent  to  a  bet  where  migrants  (M)  win  and  where  the  impact  on  residents  (R) - whose  well-being  is  a  concern  for  the  government - is  ambiguous  or  negative.  I  compare residents'welfare a) for an open vs. a closed economy, b) under the presence or absence of education externality, c) with vs. without government intervention, and d) with government's concern equal for R and M (R = M) or greater for R (R > M). Main findings are: i) residents lose under an open economy in four of the five scenarios considered, with an ambiguous result under an externality and no intervention; ii) optimal education policy has  a  positive  or  ambiguous  impact  on  residents'  welfare  (and  a  positive  impact  under  a  closed economy); and iii) welfare is higher under intervention when R > M than when R = M.  It  is  worth  noting  that,  though  the  standard  developing  country  policy  of  subsidizing  higher education is optimal under an education externality in the case of a closed economy, this result need not hold under an open economy. },
	keywords={education policy;source country residents;welfare;brain drain;education policy;net brain gain;source country residents;welfare},
            }