Brain drain boosts foreign investment in low-skill export countries.
The article explores how migration patterns, trade policies, and foreign direct investment are connected in countries that send migrants abroad. By using a model that looks at the skill levels of exports and the movement of high-skill workers, the researchers found that when exports are low-skill intensive, the emigration of high-skill workers can actually lead to more foreign direct investment. This means that migration and foreign investment can work together to benefit sending countries. Analysis of data from 103 countries between 1990-2000 supports this idea.