Using Brain Drain Migration to Induce Education Investment: An Experimental Investigation
Date Issued
2010
Date
2010
Author(s)
Bai, Yi-Ping
Abstract
We investigate the effects of emigration with laboratory experiments by employing a “minimum effort” game, in which each person in a group chooses an effort level (investment in human capital), and payoffs are determined by one’s own effort and the lowest effort in the group. This game has multiple equilibria, resembling multiple equilibria with various levels of human capital in macroeconomic models, and illustrates the coordination problem created by the externalities of education level. We find that when subjects have a chance to migrate to a new group of one’s own after the first five rounds (in which one could perfectly coordinate at the highest effort level possible), groups could sustain high effort equilibria during those rounds if the probability of migration depends on relative effort levels (brain drain). Coordination drops in the later rounds, but some groups still coordinate on better equilibria than the worse one. On the other hand, we see effort levels drop to the lowest level when there is no migration possibility or when the chances of migration is independent of effort.
Subjects
Immigration Policy
Laboratory Experiment
Minimum Effort Game
Weak-Link Game
Coordination
Economic Growth
Type
thesis
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