Impacts of Brain Drain in Both Developed and Developing Economies

¶ … Brain Drain in both Developed and Developing Economies:

Brain drain defines as the personnel migration in the search of better standards of living and an expected quality of life, which includes accessible advanced technologies, better paid jobs and sometimes a more stable political condition in different places around the world. The professionals who migrate for better work opportunities, both locally and internationally are victims of the growing concerns of unstable economic systems in most developing countries. Why do talented people choose to move abroad? What areas are affected by such migrations especially the educational sector? Which policies can stem such movements from developing countries to developed countries? (Samuelson. 2004).

Economic drain is experienced when there is a migration of skilled resources for education, trade, etc. Trained human resource is a requirement everywhere in the world. However, better living standards, attractive salaries, access to modern technology and a more stable governmental environment is what attracts people across international borders. The majority of trend is moving from developing to developed countries, because these countries have invested greatly in education, and professional training for fresh graduates, this however translates as loss of considerable human resource for the country these professionals migrate from, with the direct benefits going to the migrated countries/states who have not even invested in their education (Amiti & Wei. 2004). The key point to be remembered here is that the highly trained, professional and intellectuals of any country are some of the most expensive resources for that country in terms profitable material cost, time and more importantly because of the lost opportunity.

In 2000 alone, almost 175 million of the world's population which is approximately 2.9%

was living outside their birth country for more than 5 years. Out of this figure, 65 millions were the most active economically. This type of migration, in the past has involved many health professionals, nurses and physicians. The main reason for searching for employment in other countries is the inadequate benefits and high unemployment in one's own country.

The concept of international migration first emerged as a major economic concern in the 1940s when many trained Europeans moved to UK and USA. Then later in the 1970s, UN published a detailed 40-country research on the magnitude and emigration flow of trained professionals. According to this report, ninety percent of the migrating professionals were moving to just 5 countries: Australia, Canada, Germany, UK and USA. In 1972, 6% of the worlds doctors (140-000) were situated outside their home countries. Over three quarters were found to be only in UK, USA and Canada (Romer. 1990). The countries these resources emigrated from reflected colonial and linguistic conflicts, with a majority seen in Asian countries: India, Pakistan, and Sri Lanka.

Productivity Growth and Unit Labor Costs Since 1950

Decade

Average Quarterly Productivity Growth

Average Quarterly

Unit Labor Cost

Growth (%)

1950's

2.6

2.4

1960's

2.6

2.2

1970's

1.9

6.1

1980's

1.5

3.6

Source: Contrary Investor (2004). "The Moment of Truth for Productivity?"

If proper calculations are done then, by linking number of resources per 10-000 populations to GDP, the countries with more production of sustainable employees who showed growth in their fields after emigration were Egypt, India, Pakistan, Philippines and South Korea. However, the lack of reliable data and the difficulties of defining whether a migrant is 'permanent' or 'temporary' still exist (Romer. 1990). A few economists may suggest that the migration from developing countries to a more sustainable country, in many cases is useful, important and very much unavoidable. there are of course permanent advantages, the most common being allowing a migrant to spend good time in other countries, but economically for governments there is a very low emigration rate of professionals to and from USA or UK and may be as disturbing sign as the high rates of immigration to these countries.

The implications for poor sending countries are stark. According to the "African Capacity Building Foundation," the continent of Africa loses 20,000 skilled workers every year to developed countries with better work opportunities. Considering this, all the efforts being made by the developed world may not be of any use if the required personnel required putting into effect these development related programs are missing. Every year it is estimated that there are 20,000 fewer people in Africa than the year before; this means 20,000 fewer people to be a part of their nation's economic growth, public services and progress of greater democracy and development. The question is not that something is required to do about the ongoing. G8 leaders have already brought this subject into light on various occasions and the UK's commission on the developing countries calls for better responses, development agencies, unions and other civil society related groups demanding for action (Agrawal, Vivek & Farrell. 2003).

Draining out Brain Drain:

The important question is what needs to be done in this regard. The intuitive response

And one of the most frequently agreed upon is the attempt to plug the drain. Branching out the flow seems to be the appropriate action in this case: where these key workers departing are hurts for the sending countries, so reducing the emigration scale shall ease the pain. However, attempting to limit the movement may not prove to be most efficient procedure to tackle the problem (Salt.1997). Although the very idea of: brain drain" may be overused and a term of the past, which falsely implies that the effects of immigration of highly skilled people are always and everywhere, without any geographic restraints a negative thing.

Instead what should be adopted are better and effective procedures to analyze the total impacts of immigration, which includes any impacts of brain drain as well as nuanced policies that track particular problems where, how and when they arise. The solution should be such that one factor can used to analyze all issues which are heavily aimed at limiting movement from particular regions and countries, which could end up inhibiting development, and of course suppressing the rights of would-be migrants (Salt.1997). Furthermore, there is a dire need to produce measures that recognize a greater mobility, not less of it so that an efficient.

Productive and sustainable response can be developed for the long-term. However, like every approach this one is also met with huge challenges, one of which is finding out a way to tap into the immense economic and other benefits migration can deliver for individuals and receiving countries, while simultaneously ensuring that sending countries also benefit.

Brain Drain Is Not Always Negative:

Once the various ways through which brain drain can hurt an economy and its development have been identified, that it not just enough; because there are some suggestions out there claiming that "brain drain" may not be entirely bad, and in some cases do tend to have positive effects as well, this area is not so obvious. Yet accepting and taking into account the positive results coming from highly skilled emigration is surely the first important step for getting to the core of the brain drain issue.

To begin with, it is important to realize that that some of the very simplistic claims about economic brain drain may not be true at all. One of the very common beliefs is that, some of the people who tend to fall in the minority, who migrate return back to their homeland with greater skills Carrington (William & Detragiache.1999). Some studies also show that there is a group of thought that people who migrate from a developing nation receive education somewhere else, they get financial support in the receiving country or by any other legal means which is only concerned to them. By staying away after they are done with their studies, these student might chose not to fulfill the potential contribution which they are capable of, for their countries of origin.

In a majority of cases those who left their countries did so because they were employed or underpaid, hence their departure may not be of significance for the country professional migrated from. For example, the Philippine government's program to support temporary contract workers is still active so that unemployed but skilled professionals can explore employments in other developed countries. However the departure of skilled workers is compensated by the arrival of other skilled workers from other countries. As described in a special chapter in the OECD's 2004 Trends in International Migration, "the classic case of this domino effect is of South African doctors moving to developed countries while being replaced by Cuban doctors" (William & Detragiache.1999). At a study based approach, economists argue that there is a possibility that brain drain can have positive effects as well. Even in the poorest of countries, for instance Cuba, employment prospects and incentives may increase if reforms are introduced, so that people get motivated to acquire education, skills and hence invest in education. When this domestic "brain gain" is greater than the "brain drain," then the overall impact on sociological and economic growth may appear to be promising (Bhardan&Kroll. 2003).

Hence, it can be said that even with the fear of brain drain, if one chooses to stay in their own country at the educational or later at the professional level, then the standards at each respective level have a possibility of increasing without having to move somewhere else. While economists theorize that by no means proven beyond doubt, it is important to note that brain drain does not necessarily have only down falling impacts on a country's various factors, such as education and professional training. Furthermore, it is important to realize that the economic brain drain phenomenon can only analyze some of the factors regarding the various theories on the impact of international migration on the economy and on a country's society. Considering all the other factors of migration, such as remittances, inward investment, technology transfer, increased trade flows and charitable activities, the calculated effect, as predicted before may prove to be a welcoming change considering many factors. As discussed below, there is an urgent need to build a more at research, analysis, conclusion, and finally a practical report showing all the financial needs that can take into account all these factors.

Reducing Brain Drain May Not Be the Best Answer:

Considering that brain drain may not always be bad, then reducing the mobility of the highly skilled cream residing in ones country may not be important. With the exception of some extreme cases, certain measure that freeze the mobility of immigrants is not counted as the most effective solution to cause of brain drain (Bhardan&Kroll. 2003). To be more accurate, certain policies that are only focused on discounting the movement of immigrants from a developing country in various fields, direct into the developing countries, may only result as a temporary solution, and more importantly may not produce the desired results, some reasons are given below.

Differentiating between brain drain and brain gain: This implies, as discussed earlier, that the total economic effect of migration is based on its particular context. There is a possibility that, the specific targeted sectors in specific countries, if precautions to reduce migration are adopted, that can end up doing more harm than good.

Restricting Mobility: If attempts are made to restrict the mobility and flow of human resource, this may result in worse consequences. Evidently if would-be migrants are denied are restrained to migrate on the basis of the assumed consequences, this might be later termed as discriminatory and a compromise on human rights. Limiting would-be migrants is now termed as "compassionate racism." In which the host country restricts the professional opportunities for developing country nationals. The developed world restricts the opportunities of developing-country nationals. "The blurring lines between discriminatory immigration controls and presumably effective developed measures was best demonstrated in the controversy surrounding a controversial proposal by UK unions in early 2005 to limit the recruitment of African academics to British universities" (Bhardan&Kroll. 2003).

Practicality: There are several reasons that prove why stopping the flow of immigration does not work most of the times. People always find a way, if a country's policy won't allow them to migrate, then they can always apply directly to some organization in the country they want to migrate into, once they get an acceptance letter; the organization can sponsor them on their own, hence they find a "way around the law." Some may seek to move, but just not declare that they have certain qualifications -- resulting in a brain waste that helps nobody.

If we consider the effects of brain drain on a bigger economic level, then restricting immigrants does have the possibility of undermining considerable benefits that a trained professional might bring with him, which can cater to global efficiency. Economist have long researched that an increase labor force with greater mobility results in positive economic sense. Some, such as Alan Winters, have even demonstrated the potential size of these gains. Given demographic and developmental disparities, the potential gains from increasing such mobility are immense. While migration does have its negative impacts on some countries, and based on some positive effects of migrations we cannot base the entire over all policy stances and should not underestimate the rational of resisting the pressures of greater human mobility (Bhardan&Kroll. 2003).

Economic Drain in Developed Countries:

In the present times, there is an ongoing tension between the national policies of many developed countries, for instance Netherlands, who are not aiming at attracting high skilled labor. While on the other case policies are being drafted to encourage development at the hands of a country's own people and prevent brain drain at least in the sensitive areas, such as health and education sectors. No consensus however exists on the extent of the problem of brain drain, nor its solutions.

The question of the hour is how "large" the loss of "brains," that is it possible to overcome professional loss by allowing, other immigrants from other country to prove their mantel. These questions after extensive research have been answered by experts in their various studies. Studies conducted on the basic level by researchers, discovered a positive and unique effect of migration on the economy of 37 countries, which encouraged the prospects of human capital formation. Carrington and Detragiache computed emigration rates at three educational levels for a large set of developing countries, Making use of such data they found out that "countries have found simple but strong support regarding the benefits of brain drain in cross section for 50 developing, where the migration level of highly educational and trained individuals was calculated to be 20% and the proportion of people with higher or advanced level education is 10%" (Beattie. 2004).

Especially small countries got a heavy economic boost one such trained professional were working in their major leagues. However, from the developing countries perspective, the most worrisome situation was observed in the Sub-Saharan Africa and Central America.

Effects if Brain Drain on Developed Countries:

The first can be the effect the option for emigration has on the growing potential of the sending country. The inflictions are in generous amounts, rom the added responsibility of educating these people, the amalgamation of societal issues to the capital that is required for a business initiation.

The second effect will be the total amount of lost human capital. This effects factors like economy (multiplier effects, dependency, labor market situation), education (quality of education, educational attainment), health (provision and quality of health services), institutions (the competence of local public institution, trust in public institutions).

The third effect would be that high skilled migrants will be deriving their country of the talent they possess, which they will be utilizing in a far more developed country than their own, hence from the developed country's perspective it's just another added resource but for the developing country it's a precious resource lost.

These are the effects that take place through professional migration. In reality these factors do tend to overlap, but still a conceptual distinction can be made between these factors (Beattie. 2004). A theoretical and factual insight can be gained through these researches, they can also be helpful in specifying the study of policy instruments that can be utilized to overcome or to some extent minimizing the down fall effects of economic explosion: from drafting policies that consider ethical issues to consolidating monetary resources between cities/states, so that the professional loss that is an ongoing threat can be overcome to a certain extenet.

The Impact of Development Policy on Migration:

After much research there are still various unanswered questions regarding the effect of various policies on the possibility of skilled professionals and their decision to migrate into a developed country. Various questions enter a person's mind for instance if progress is made in the important fields in their own country, for example prominent contributions in educations and health sector, will they be motivated and encouraged enough to migrate? In order to find out whether development policies have any effect on economic brain drain we can analyze certain points, for example we could investigate the determinants of highly skilled immigrants in order to understand whether their behavior can be influenced by various development policies (Basu, Fernald & Matthew. 2001).

Since development policies are for everyone that included the immigration of low skilled immigrants and hence affects them too, another question that could be asked is to what extent these policies can restrain the flow of low skilled labor since it is next to unwanted. A related question is whether developing countries consider migration as a factor in national development techniques and developing factors. The most prominent question posed in the present times is whether these proposed strategies are effective and to what extent, also what are the other factors that mainstream migration into national development planning.

Brain drain concerns in developing countries:

To make our explanation simple, we will consider only one professional area and analyze it to its length. In many developing countries, engineers graduate at the bachelor's level, in all the cases the quality of training and education provided is of much less quality since throughout the time spent in the professional institute, most of it is used in remediation of primary and secondary school short comings. In most cases many graduates stay in their own country making do whatever they can earn from their routine work, but in some cases some graduates got to a well developed country for their post graduate education. With a masters or a PhD from a well recognized engineering program, thus after receiving such extensive research-based education, one does not want to go back to their own country and settle for less than what they deserve. Hence these graduates search for jobs in the same country they migrated to, as to match their skills and training to their employment (Basu, Fernald & Matthew. 2001).