Migration as an antidote to rent-seeking?
Journal of development economics, 2007, Vol. 84, No. 2, pp. 609-630
MARIANI, Fabio, Migration as an antidote to rent-seeking?, Journal of development economics, 2007, Vol. 84, No. 2, pp. 609-630 - https://hdl.handle.net/1814/42753
Retrieved from Cadmus, EUI Research Repository
We develop a new mechanism through which skilled migration may influence economic performance in the sending country. If agents can choose between acting as rent-seekers and engaging in productive activities, and only productive skills are exportable, a positive probability of migration (to a more secure economy) reduces the relative expected returns from rent-seeking, thus decreasing the proportion of skilled workers who opt for “parasitic” activities. Such an improvement in the allocation of talent may prevail over the loss of skilled workers due to outmigration. However, we show that this result is not robust to the introduction of endogenous protection. If productive workers share their resources between accumulation of productive capital and investment in security, prospective migration may induce a weaker protection against rent-seeking, which in turn might depress average income in the source economy.
Cadmus permanent link: https://hdl.handle.net/1814/42753
Full-text via DOI: 10.1016/j.jdeveco.2007.02.001
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