Skill Choice, Brain Drain, and Variety of Goods: Innovation in the Core Periphery Model

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DOI:

https://doi.org/10.59670/ml.v19i1.1187

Keywords:

Skill choice, brain drain, innovation, variety of goods, core-periphery model

Abstract

People judge whether they want to be high-skilled workers by considering the economic returns and the effort required to skill. This study considers two regions: an advanced industrial region, where high-skilled workers increase the variety of goods through innovation, and an underdeveloped region where innovation does not occur. Here, workers become high-skilled, considering regions of origin and potential abilities. Numerical simulations show that the proportion of high-skilled workers reacts in an inverted U-shape, as the variety of goods increases. When the variety of goods is small, the ratio of high-skilled workers in the developed regions is higher than that in the underdeveloped regions; as it increases, the proportion of high-skilled workers born in both regions increase. The proportion of high-skilled workers born in developed regions eventually declines; however, it increases in the underdeveloped regions. As the variety of goods increases, the proportion of high-skilled workers decreases in the underdeveloped regions.

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Published

2022-01-17

How to Cite

Chen, I.-C. ., & Hiramatsu, T. (2022). Skill Choice, Brain Drain, and Variety of Goods: Innovation in the Core Periphery Model. Migration Letters, 19(1), 55–66. https://doi.org/10.59670/ml.v19i1.1187