Abstract
This paper provides a novel explanation of "educated unemployment", which is a salient feature of the labor markets in a number of developing countries. In a simple job-search framework we show that "educated unemployment" is caused by the prospect of international migration, that is, by the possibility of a "brain drain". In addition, the analysis shows that a developing country may end up with more educated workers despite the brain drain and educated unemployment.
| Original language | English |
|---|---|
| Pages (from-to) | 76-87 |
| Number of pages | 12 |
| Journal | Journal of Development Economics |
| Volume | 83 |
| Issue number | 1 |
| DOIs | |
| Publication status | Published - 1 May 2007 |
Bibliographical note
We are grateful to Gordon Hanson and to an anonymous referee for helpful advice, enlightening comments, and constructive suggestions.Funding
Financial support from the Humboldt Foundation, the Sohmen Foundation, and the International Centre for the Study of East Asian Development is gratefully acknowledged.
Keywords
- "Educated unemployment"
- Beneficial brain drain
- Human capital formation
- International migration
