Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73748
Authors: 
Eggert, Wolfgang
Krieger, Tim
Meier, Volker
Year of Publication: 
2009
Series/Report no.: 
Ifo Working Paper 78
Abstract: 
This paper studies a two-region model in which unemployment, education decisions andinterregional migration are endogenous. The poorer region exhibits both lower wagesand higher unemployment rates, and migrants to the richer region are disproportionallyskilled. The brain drain from the poor to the rich region is accompanied by strongerincentives to acquire skills even for immobile workers. Regional shocks tend to affectboth regions in a symmetric fashion, and skilled-biased technological change reduceswages of the unskilled. Both education and migration decisions are distorted by auniform unemployment compensation, which justifies a corrective subsidization.
Subjects: 
Brain drain
brain gain
education
unemployment
interregional migration
externalities
JEL: 
H23
I20
J61
J64
R10
Document Type: 
Working Paper

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