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Economic Analysis of Brain Drain

Lien, Da-Hsiang Donald (1985) Economic Analysis of Brain Drain. Social Science Working Paper, 556. California Institute of Technology , Pasadena, CA. (Unpublished)

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In this paper, we consider the possibility of signaling and individual's two-stage decision procedures within an asymmetric information framework to investigate the brain drain phenomena. The results indicate the relationship between an individual's ability and the signal he will choose at rational expectations equilibrium. Also, the persons who will remain abroad are identified. Where the ranking of the universities provides the signal to domestic employers, we can therefore interpret these results in such a way that there is an association between students of a particular quality and corresponding qualities of universities they will choose to attend to attain Ph. D.'s. Moreover, we can predict whether these graduating Ph.D.'s choose to return home or remain abroad.

Item Type:Report or Paper (Working Paper)
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Additional Information:I am grateful to Richard McKelvey for long helpful discussions to Leonid Hurwicz and Joel Sobel for constructive suggestions, to Robert Bates and James Quirk for valuable comments on an earlier draft. Of course, all errors remain mine. Published as Lien, Da-Hsiang Donald. "Economic analysis of brain drain." Journal of Development Economics 25.1 (1987): 33-43.
Group:Social Science Working Papers
Series Name:Social Science Working Paper
Issue or Number:556
Record Number:CaltechAUTHORS:20170918-141006507
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Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:81536
Deposited By: Jacquelyn Bussone
Deposited On:19 Sep 2017 16:54
Last Modified:03 Oct 2019 18:44

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