The prospect of migration, sticky wages, and 'educated unemployment'
Document Type
Journal article
Source Publication
Review of International Economics
Publication Date
5-1-2011
Volume
19
Issue
2
First Page
277
Last Page
287
Publisher
Wiley-Blackwell Publishing Ltd.
Abstract
An increase in the probability of work abroad, where the returns to schooling are higher than at home, induces more individuals in a developing country to acquire education, which leads to an increase in the supply of educated workers in the domestic labor market. Where there is a sticky wage-rate, the demand for labor at home will be constant. With a rising supply and constant demand, the rate of unemployment of educated workers in the domestic labor market will increase. Thus, the prospect of employment abroad causes involuntary “educated unemployment” at home. A government that is concerned about “educated unemployment” and might therefore be expected to encourage unemployed educated people to migrate will nevertheless, under certain conditions, elect to restrict the extent of the migration of educated individuals.
DOI
10.1111/j.1467-9396.2011.00946.x
Print ISSN
09657576
E-ISSN
14679396
Publisher Statement
Copyright © 2011 Blackwell Publishing Ltd
Access to external full text or publisher's version may require subscription.
Full-text Version
Publisher’s Version
Language
English
Recommended Citation
Stark, O., & Fan, C. S. (2011). The prospect of migration, sticky wages, and 'educated unemplyment'. Review of International Economics, 19(2), 277-287. doi: 10.1111/j.1467-9396.2011.00946.x