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Four Ways Brain Drain out of Africa is a good thing

Conventional wisdom frets that the exodus of skilled workers—the brain drain—is bad for African countries. The share of Africans with college degrees who live outside their home countries is certainly high: nearly half of Ghanaians, about 40 percent of Kenyans, and about one-third of Ugandans.

The metaphor of the term itself implies that brain drain is a waste, as if all Africa’s most promising minds were being sucked down some global sink, leaving behind a parched continent. But a paper by William Easterly and Yaw Nyarko, published as a chapter in the new book Skilled Immigration Today: Prospects, Problems, and Policies, explores the arguments for and against brain drain, and builds on previous literature to argue four ways the benefits of brain drain could outweigh the costs to African countries.

1. Gains to migrants themselves. Why is this often ignored in brain drain discussions? Perhaps it reflects a neglect of the rights and well-being of individuals and an overemphasis on the nation-state as the object of development. The migrant is better off with higher living standards, not to mention satisfying her revealed preference to live in a country other than where she was born.

2. Gains to migrants’ families. Remittances is the most obvious and commonly-cited benefit of the brain drain. Even using official figures, which likely far undercount the value of remittances by excluding informal channels, remittances sent back by Africans abroad outweigh the cost of educating them at home. Why pass up a high return opportunity (Africans earning high incomes abroad and remitting) and insist on a low return activity (educated Africans underemployed at home)? Not to mention that families also get satisfaction from seeing their offspring realize their dreams.

3. Brain circulation.  Brains don’t just leave Africa, never to return.  Africans who have been educated or worked abroad do come back to their home countries to visit, to establish dual residence, to start businesses and universities, and, sometimes, to stay. These people bring back new ideas and skills—crucial ingredients to economic growth. Similar processes brought enormous benefits already to Asia and Latin America, so why would donors want to shut down this motor of opportunity only for Africa?

4. Stimulation of skill accumulation (“brain gain”). The possibility of migration and the example of role models who find success abroad (the Kofi Annan factor) provide incentives for young students to work hard and gain skills that will help them overcome the hurdles to migration. The authors argue that the new human capital created through these incentives offsets the loss of skilled people who do eventually leave.

If brain drain is not the bogeyman it is made out to be, those who argue for programs that restrict individual freedom in the name of “staunching the flow of brains” from Africa have even less of a case. (For example, the World Bank and the IMF published a 2007 report noting that “countries concerned about a ‘brain drain’ of their trained physicians to OECD markets might be able to reduce risks by setting national training requirements slightly lower than the rich countries’ standards.” The group Physicians for Human Rights has recommended that “[d]eveloping countries and organizations in developing countries should explore possibilities of limiting recruitment from abroad.”)

A better way to help migrants, and the African countries they come from, would be to increase even more the benefits of the so-called drain. For example, scholarship and exchange programs will increase the likelihood of brain circulation. Regulations and technologies to reduce the transaction costs of remittances sent home will be win-win for all.

Would Americans put up with a program that inhibits them from working in London or Paris? Skilled African migrants don’t need international organizations suggesting restrictions on where they should live and work either.

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19 Comments

  1. Pierre-Louis wrote:

    And also the protrade effect of migrant networks! African migrants, with their knowlegde of both african and host country markets and business ways, make trade with Africa easier, or even creates it!

    Good job on the last sentence. I am tired of elitist PhDs who want to design policies to help African countries. Ridiculous.

    Posted February 17, 2010 at 3:44 am | Permalink
  2. Carl-Henri wrote:

    I completely agree with the 4 points and I am not going to advocate for greater restrictions on migration. However I’m wondering if there’s negative effect of migration on governance in some sending countries. Maybe greater migration opportunities leads to a lower demand for better governance in some sending countries, as many people know they can increase their living standards ( by migrating) without trying to hold their government accountable. Even if some people never migrate, the migration prospect may lead them to lower their demand for better governance. I haven’t read the book yet, I’m just wondering if you see that as a potential detrimental effect…

    Posted February 17, 2010 at 8:41 am | Permalink
  3. nadeem haque wrote:

    You seem to have ignored some of the work that we did at the Fund. I think it is trivial to say that there is a brain gain if he alternative is autarky, ie, no migration.
    For a serious discussion of the issue we need to confront the role of human capital in the growth process and institution building.
    What you need confront is:
    1. If the Lucas human capital accumulation over generations leads to increasing returns and higher levels of growth (Lucas 88), then brain drain would lead to permanent losses. http://ideas.repec.org/p/imf/imfwpa/94-155.html
    2. If talent is requires to set up institutions or to provide seekers in the Easterly model, then to lose the most skilled will also lead to an excess loss to the economy.
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=987449
    3. In continuation of Point 2, we all seem to think that TA is continually required to build necessary skills, rules and regulation in the poor countries. We spend billions on consultants and advisors to fill critical skill gaps that are bottling up growth. Surely, that does not seem to suggest skills may be necessary.
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=961722

    Posted February 17, 2010 at 10:05 am | Permalink
  4. Great points. I’m not surprised to hear the IMF and WB study suggest lowering standards in health education as a measure to stem the outflow of African physicians. It seems to me that the best way out is to encourage trainee and exchange programs and which will see most of trained African physicians giving back to their countries.

    Posted February 17, 2010 at 10:08 am | Permalink
  5. nadeem haque wrote:

    Why is that all discussions of brain drain are based on assumed solutions based on curbs to migration. Seems economists are schizophrenic. On most things we are told to think incentives while on the brain drain it is curbs. I have argued for long time that the brain drain is happening because of skewed incentives…..tax the local talent and subsidize aid consultants. Where is the brain gain from this?
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=987449
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=961722

    Posted February 17, 2010 at 10:23 am | Permalink
  6. David Shea wrote:

    Let me get this straight. People are making economic decisions in their best interest? What can be done? :-D

    Posted February 17, 2010 at 10:53 am | Permalink
  7. Banko wrote:

    My problem is with those who are trained with public resources and quit the country or remain in their host country. Their personal achievements or the remittances to their families do not make up for the public resources invested in them.
    Imagine the number who die in Africa annually because its physicians are seeking greener pastures, many of whom trained with public money. How much do Bill and Yaw value a human life in Africa compared with the gains from brain drain. I think countries in Africa deserve more from educated migrants than their individual achievements and remittances to their families.
    Consider this case: a European country trains Africans through loans granted to their countries. After studies, the Africans stay, work, create wealth, pay taxes in the European country while their poor countries are suffocating with debt repayment. Is this fair?

    Posted February 17, 2010 at 11:17 am | Permalink
  8. mugoya wrote:

    David is right. In the past many African’s fled to Europe and the US primarily because of fear of persecution,death and constant civil wars. Today, a few leave beacuse of economic problems (with a view of returning)and to be fair Afircans in the diaspora have extremely strong ties with thier homelands.

    What can we do?
    Educate, invest and return. I regularly visit Uganda and one will be surprised at the pace of development and of the unwillingness of Ugandan intellectuals to leave. Indeed many have returned from all over the world. The same applies to Ghana.

    The other issue is progression and personal development. I will cite an example- most Africans who train abroad have either no quals or have already gained a qual and are seeking further qual’s. A doctor who gains a Phd as a nuero-surgeon in Japan has very limited opportuniites to practice in the developing world let alone further their contributuin to medicine.If you look at the bigger picture, Africa and indeed all emerging markets are stronger today because of the diaspora.

    It’s all very well for the Phd’s to theorise from New York but have they done any recent research in Africa that clearly illustrates that the so called brain drain has a negative impact?

    Posted February 17, 2010 at 12:32 pm | Permalink
  9. The Aid Watch so often takes a curmudgeonly position vis-a-vis the herd of development economists and liberal feel-good views on development issues, it must be a relief to, for once, come in out of the cold and to join with Bhagwati & Co. to praise the globalization of skilled labor, i.e., the brain drain. But labor mobility issues are notoriously complex and cannot be adequately dealt with by repeatedly setting up strawmen and then knocking them down. One can always find a few troglodytes on most any issue, and just answering them is not the way to really address the issues and advance the discussions. The thrust of the paper and blog was answering the trog strawmen who just want to forbid skilled labor migration and perhaps even travel, so the authors have taken a strong position against such a position. Bravo, but is that really where the informed debate is on this issue?
    Or take the feel-good position of defending those individuals who take the economic decision to better their own position and that of their family. Bravo again. But ordinarily economists learn about the prisoner’s dilemma situations where joint cooperation is best for all but where individual defectors can do still better themselves. It is not hard to see that the nationalist (called “mercantilist” in the paper) effort to develop a country is like a multi-person prisoner’s dilemma situation. Yes, it really is better for the individual defectors and their families to defect; that is why prisoner’s dilemma situations are so frustrating, but one does not resolve the problems of that sort of dilemma by praising the defector’s touching concern for their children’s futures.
    Or take the praise of remittances which seems to ignore decades of research that while remittances obviously alleviate poverty, their effects on development are nil or negative. One should not dismiss the idea that it matters where the development is (i.e., where the jobs are) as being “mercantilist” in favor of a globalized view that the South can alleviate poverty (but probably forego development itself) by serving as a bedroom community for skilled and unskilled labor to work in jobs in the North and remit back to the South. Of course, one can indulge in more feel-good ideas about how all those remittances “may” lead to development, but one needs to address the decades of experience and arguments about why it usually works the other way around. I could go on but this is only a comment. I recently blogged on poverty reduction vs. development (http://www.blog.ellerman.org/2010/02/development-or-just-poverty-reduction/), and that post contains the links to papers specifically on the migration issue.

    Posted February 17, 2010 at 1:00 pm | Permalink
  10. Geoff wrote:

    What about the effect that remittances have on local inflation?
    I can’t understand all the hype about remittances when often they just result in rising prices. This has been my experience in places like Samoa around the ‘remittance season’ ie christmas etc. The price of food sky rockets.

    Is this effect ever built into migration models that use remittances?

    Posted February 17, 2010 at 2:36 pm | Permalink
  11. Stephen Jones wrote:

    The worker sends remittances back, but very often the doctor or economist brings his family over to their new country.

    Posted February 17, 2010 at 2:42 pm | Permalink
  12. Ehui wrote:

    Is the conversation about brain drain/gain and opportunities in migrant countries mutually exclusive?

    I have seen many conversations about why the brain drain/gain, but little about why people leave their countries. Regardless of whether there is a brain or drain, the primary reasons why people leave (professional development, better lifestyle, security, income etc) need to be addressed. That way I can choose whether to contribute to Ghana from within or outside it!

    Posted February 17, 2010 at 7:48 pm | Permalink
  13. I was wondering how this fits into the “competitive jurisdictions” issue. It is fairly clear that, over the long run, competitive jurisdictions were vital to NW Europe’s economic take off and (oddly enough) Japan’s ability to be the first non-European or European-settled state to join them by forcing a relatively higher provision of public goods by rulers. (The competitive jurisdictions in Japan were the individual daimyo-run provinces.) I realise that one of the big problems of aid is that it undermines such incentives (or even makes them toxic) but adjusting local arrangements so there is less incentive for skilled people to leave/stay away could be a driver of African institutional development just as it was in NW Europe and Japan.

    Posted February 18, 2010 at 7:10 am | Permalink
  14. Wayan wrote:

    Wait! There is a program that inhibits Americans from working in London or Paris – its called a work permit. Americans need one to legally work in the EU, else we’re just illegal immigrants ourselves.

    Posted February 18, 2010 at 2:23 pm | Permalink
  15. Alan Hudson wrote:

    Any attempt to make a generalisation about whether outward migration from developing countries is a net benefit or a net loss, lets say for those countries’ economies (and the unit of analysis matters), is unwise.

    Just as with trade liberalisation, for some countries it’s a good thing, for some it’s not. It depends on the context. The context of the originating countries (do they have an excess of human capital, does the export of human capital actually increase the supply – that might depend on educational facilities for instance) and the context of the destination country (what wages do migrants get paid and what rights do they have etc. etc.).

    (Yeah, in the long run – and in economic models – liberalisation might be good for everyone, but in the long run we’re dead, and politics as always complicates the neatness of the economic analysis)

    So, while the efforts of Michael Clemens and others to challenge the received wisdom on the “inevitable” problems of brain drain and the empirical analysis is welcome, it would be a mistake to replace that received wisdom by flipping to a simplistic generalisation on the other side.

    And, not all migration is good for the family left behind or the individual who goes. Just talk – as I have been – to some of the Ethiopian families who have family members who have gone to work as domestic servants in the middle east. “Worse than slavery” is how an Ethiopian friend described it to me yesterday.

    I don’t have the expertise of people like David Ellerman on this, but I did draft a report on Migration and Development for the UK Parliament some years ago which looked at some of the contextual factors that will shape whether a migration flow is good or bad for poverty reduction in an effort to see how policy makers might influence some of those factors to make migration work better for poverty reduction http://www.publications.parliament.uk/pa/cm200304/cmselect/cmintdev/79/79.pdf

    Posted February 18, 2010 at 3:47 pm | Permalink
  16. George D wrote:

    And of course, these arguments are usually made by people who have the freedom to work and live abroad, and who have often used it.

    Migration is neither an unmitigated good nor harm, and I’m glad this post has been made.

    My own home country, New Zealand, puts conditions on migrants (1m abroad from 4.3m). If you leave you’re not eligible for interest writeoffs on your student loan.

    A middle-road approach which combines a little carrot and a little stick doesn’t seem unreasonable.

    Posted February 19, 2010 at 12:42 am | Permalink
  17. Dan Kyba wrote:

    There are two core issues here which the article nails down:
    Firstly, there is the matter of individual human freedom and the right to seek out one’s best opportunities. In first year economics I was told that people are always more important than boundaries. As the grandson of an immigrant family, I instinctively supported and still support that argument.
    Secondly and more important from a development prospect:
    Allowing emigration from developing to developed countries increases the potential value of human capital for the developing country IF that country chooses to improve its social, economic and political environment. There is always a backwash of former emigrants who return to their countries of origin when such positive changes occur and it is these people who, with their experience of working in developed countries, who bring their institutional experience to bear in potentially making that positive change permanent. This type of institutional knowledge cannot be taught in a classroom but rather must be learned through experience. This may be done either slowly through trial and error as did the British over 250 years as they developed their market economy and democratic institutions, or the process can be speeded up by providing people from developing countries the educational experience of living and working in such an environment.
    Consider that the Marshall Plan worked in Europe mainly because of the existing stock of human capital that knew how to operate a developed economy and its necessary institutions. One reason massive influxes of aid to developing countries has not seen the same positive results as occurred in Europe is that the stock of human capital is so much less.

    Posted February 19, 2010 at 11:43 am | Permalink
  18. jina wrote:

    “The authors argue that the new human capital created through these incentives offsets the loss of skilled people who do eventually leave.” That’s not how it worked out in West Virginia, where I grew up. At least not visibly, though I’m sure the theory that in the long run, human capital balances out in the aggregate (which is somehow not the culprit that the nation-state project is, why?) would make all my old neighbors feel better.

    Posted February 23, 2010 at 10:55 pm | Permalink
  19. Maibi Ben-Horsfall wrote:

    Completely agree with Alan Hudson! Ghanaians may be able to come back to Ghana and set up shop with little to no effort. As someone from Nigerian descent, I can’t say that is the case for Nigerians.

    Posted February 24, 2010 at 10:25 am | Permalink

7 Trackbacks

  1. By the “brain drain” debate « Opalo’s weblog on February 17, 2010 at 2:37 am

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  2. By The Brain Gain on February 17, 2010 at 9:13 am

    [...] Laura Freschi at AidWatch lists four ways in which the brain drain from AfricaL is a good thing. Her analysis includes (a) gains to the migrants; (b) gains to the migrants’ families; (c)the benefits of exchange of ideas; and (d) the stimulation of the accumulation of skills. [...]

  3. [...] “Brain Drain” is a Always and Everywhere a Red Herring. [...]

  4. [...] or stimulated by a piece on migration on Owen Barder’s blog, referencing a piece of the AidWatchers blog, I’ve stuck my oar in. I’ve been wanting to do this for a [...]

  5. By Saturday Reading for 20 Feb 2010 « Parallax World on February 20, 2010 at 3:44 am

    [...] http://aidwatchers.com/2010/02/four-ways-brain-drain/.  AidWatch summarizes a counter-intuitive paper by William Easterly and Yaw Nyarko about the benefits of educated Africans living outside of their home country.  I liked: that it added nuance to the debate over the challenges of building capacity in emerging markets by showing that there is benefit to training and education even if someone doesn’t stick around.  If this applies to migration out of a country, it certainly applies to someone switching jobs within a country. I wished: that it had also mentioned the costs of migration by the educated workforce (such as too few health workers).  While the economic benefits of someone living overseas may outweigh the costs of training, there are other ramifications that aren’t captured by looking solely at inflows and outflows. [...]

  6. By Link Archipelago « Let A Thousand Nations Bloom on February 20, 2010 at 2:00 pm

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    The Aid Watch blog is a project of New York University's Development Research Institute (DRI). This blog is principally written by William Easterly, author of "The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics" and "The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good," and Professor of Economics at NYU. It is co-written by Laura Freschi and by occasional guest bloggers. Our work is based on the idea that more aid will reach the poor the more people are watching aid.

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