We study migration in the right tail of the talent distribution using a novel dataset of Indian high school students taking the Joint Entrance Exam (JEE), a college entrance exam used for admission to the prestigious Indian Institutes of Technology (IIT). We find a high incidence of migration after students complete college: among the top 1,000 scorers on the exam, 36% have migrated abroad, rising to 62% for the top 100 scorers. We next document that students who attended the original “Top 5” Indian Institutes of Technology (IIT) were 5 percentage points more likely to migrate for graduate school compared to equally talented students who studied in other institutions. We explore two mechanisms for these patterns: signaling, for which we study migration after one university suddenly gained the IIT designation; and alumni networks, using information on the location of IIT alumni in U.S. computer science departments.
This an uncomfortable trade-off for a Classical Liberal committed to Age of Enlightenment Classical Liberal Values. It is wonderful that people from all around the world are, to a degree, able to locate where their talents are most likely to be most highly valued.
In reality, of course, this is primarily true only for those with greatest talent. The more mundane or average your ability, the less likely there are to be geo-spatial arbitrage opportunities for your labor. But it is good for global productivity and it is good for individuals with great talent that they are able to go where their talent is most likely to be converted into the greatest increase in productivity.
Except . . . What about the country which invested its scarce resources in the education and development of talent in that individual in the first place? A lot of national money in and little immediate return if the recipient turns around and immigrates as soon as they have their degree.
I seem to recall some stats from West African medical programs in the late seventies. Their whole public health system was rickety in the first place. They had trouble finding and channeling talent into programs and once they received their medical qualifications, they were losing half their graduates to developed countries.
It feels like the developed world is pillaging the developing world of talent. And to some degree it is. Possibly it is not really that big a deal if we take a long enough view. If we look only at a decade, we see the talent depart along with all the investment in that talent.
Possibly, though, if we look at three, four or five decades, we see a more cosmic evening out. Some small number of the emigres make it big. At some point they come back, or at least invest back into the home country which invested in them. If we look at a decade, we know recipient country and the individual country benefit. Maybe if we look at four decades, we might see that investing country, recipient country and the individual all benefit. And maybe it is obvious to everyone.
Right now, though, we don't easily see that. As in this study, we see the talent leaving, and somehow it feels both a triumph of the Classical Liberal order and it also feels somehow wrong.
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