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International migration, imperfect information, and brain drain

Author

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  • Dequiedt, Vianney
  • Zenou, Yves
Abstract
We consider a model of international migration where skills of workers are imperfectly observed by firms in the host country and where information asymmetries are more severe for immigrants than for natives. Because of imperfect information, firms statistically dicriminate highly-skilled migrants by paying them at their expected productivity. The decision of whether to migrate or not depends on the proportion of highly-skilled workers among the migrants. The migration game exhibits strategic complementarities, which, because of standard coordination problems, lead to multiple equilibria. We characterize them and examine how international migration affects the income of individuals in sending and receiving countries, and of migrants themselves. We also analyze under which conditions there is positive or negative self-selection of migrants.

Suggested Citation

  • Dequiedt, Vianney & Zenou, Yves, 2013. "International migration, imperfect information, and brain drain," Journal of Development Economics, Elsevier, vol. 102(C), pages 62-78.
    • Handle: RePEc:eee:deveco:v:102:y:2013:i:c:p:62-78
    DOI: 10.1016/j.jdeveco.2013.02.002
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    Cited by:

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    4. Tani, Massimiliano, 2018. "Selective Immigration, Occupational Licensing, and Labour Market Outcomes of Foreign-Trained Migrants," IZA Discussion Papers 11370, Institute of Labor Economics (IZA).
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    6. Stark, Oded & Byra, Lukasz & Casarico, Alessandra & Uebelmesser, Silke, 2017. "A critical comparison of migration policies: Entry fee versus quota," Regional Science and Urban Economics, Elsevier, vol. 66(C), pages 91-107.
    7. Jan Ditzen, 2014. "Economic Growth and Migration," SEEC Discussion Papers 1406, Spatial Economics and Econometrics Centre, Heriot Watt University.
    8. Agrawal, Ajay & Lacetera, Nicola & Lyons, Elizabeth, 2016. "Does standardized information in online markets disproportionately benefit job applicants from less developed countries?," Journal of International Economics, Elsevier, vol. 103(C), pages 1-12.
    9. Gui Ye & Yuhe Wang & Yuxin Zhang & Liming Wang & Houli Xie & Yuan Fu & Jian Zuo, 2019. "Impact of Migrant Workers on Total Factor Productivity in Chinese Construction Industry," Sustainability, MDPI, vol. 11(3), pages 1-18, February.
    10. Tani, Massimiliano, 2018. "Selective immigration policies, occupational licensing, and the quality of migrants’ education-occupation match," GLO Discussion Paper Series 206, Global Labor Organization (GLO).
    11. Auer, Daniel & Tetlow, Daniel, 2020. "Brexit, collective uncertainty and migration decisions," Discussion Papers, Research Unit: Migration, Integration, Transnationalization SP VI 2020-102, WZB Berlin Social Science Center.
    12. Izza Mafruhah, 2016. "The Placement Model for Indonesian Migrant Workers to Improve their Economic Welfare," GATR Journals jber116, Global Academy of Training and Research (GATR) Enterprise.
    13. Dongmei Guo & Die Hu & Weizeng Sun, 2023. "Effect of goods market segmentation on labor mobility: Evidence from China," Review of Development Economics, Wiley Blackwell, vol. 27(1), pages 423-449, February.
    14. Qingyi Chen & Yuting Liu & Zuolin Yao, 2024. "Spatial–Temporal Pattern Evolution and Differentiation Mechanism of Urban Dual Innovation: A Case Study of China’s Three Major Urban Agglomerations," Land, MDPI, vol. 13(9), pages 1-22, August.
    15. Tani, Massimiliano, 2017. "Skilled Migration Policy and the Labour Market Performance of Immigrants," IZA Discussion Papers 11241, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Asymmetric information; Self-selection of migrants; Skill-biased migration;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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