HUMAN-CAPITAL DEPLETION, HUMAN-CAPITAL FORMATION, AND MIGRATION - A BLESSING OR A CURSE

We specify conditions under which a strictly positive probability of e mployment in a foreign country raises the level of human capital forme d by optimizing workers in the home country. While some workers migrat e, ''taking along'' more human capital than if they had migrated witho ut factoring in the possibility of migration (a form of brain drain), other workers stay at home with more human capital than they would hav e formed in the absence of the possibility of migration (a form of bra in gain). (C) 1998 Elsevier Science S.A. All rights reserved.