Wednesday, February 04, 2009

Brain Bank Pittsburgh

How might a region benefit from out-migration? Even in the best case scenarios, brain drain (i.e. net loss of talent) is bad for the local economy. The best solution to the problem is to import more talent than you export. Unfortunately, most policy targets young adults in attempt to keep them from leaving.

Fighting out-migration is foolish, but some communities feel that they have no choice. Many places are simply unable to attract enough newcomers to replace the brains that leave. But the lack of high density human capital is not a death knell for a region. When talent emigrates, it is not necessarily lost:

Another important channel through which the home country can benefit from emigration is via an exchange of ideas and technologies between domestic innovators and its diaspora. A recent research paper by Agrawal, Kapur, and McHale sheds light on this very issue using Indian data.* The authors argue that the emigration of an innovator leads to a reduction in the number of domestic innovators but at the same time, it can also lead to access to foreign-produced knowledge through the links with diaspora. In other words, ‘brain drain’ can transform into a ‘brain bank’, accumulating knowledge abroad and facilitating its transfer back to domestic inventors. This effect can dominate when there are strong connections to the diaspora.

Pittsburgh would benefit from a lot more "foreign-produced" knowledge. Pittsburghers leaving home is a given. In-migration is poor and not likely to get much better, at least in the near term. Instead of another anti-brain drain initiative, why not foster a knowledge relationship with the Burgh Diaspora?

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