Brain Drain

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The surge in globalization since the end of World War II has been fueled chiefly by an international exchange of goods and capital rather than people. There are signs, however, that international migrants are playing an increasingly important role in globalization as the world enters the twenty-first century. What are the costs and benefits of this new wave of migration?

The principal cost of this migration, as far as developing countries are concerned, is its "brain drain." Those residents of developing nations, able to find work in the developed world are those who are well educated; unfortunately, these are also the ones their native countries needs most. The resultant brain drain hamstrings developing nations with lower productivity, decreased levels of technical skill, a disproportionately-smaller tax base (because higher-educated, higher-earning workers pay more in taxes than they receive in services).

The costs of brain drain, however, are offset to some degree by the benefits of remittances that migrant workers send back to their native countries. While expatriates generally use these payments to support their less-fortunate family members, the resulting economic advantages extend well beyond any particular household. Remittances, the World Bank finds, help to significantly reduce poverty and equalize incomes. Indeed, higher rates of migration reduce the costs of moving overseas and allow poorer and less-educated workers to seek new economic opportunities abroad—which not only equalizes economic success and opportunity, but helps to counteract the unbalanced effects of the brain drain.

The World Bank concludes that higher rates of international migration are inevitable: the phenomenon a result of demographic trends that create a high demand for certain forms of labor in the developed world and a high supply of that labor in developing nations, and of declining communication and transportation costs. Moreover, international migration is desirable:...
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