From Brain Drain to Brain Circulation? How Countries Can Draw on Their Talent Abroad

Transcription

1 From Brain Drain to Brain Circulation? How Countries Can Draw on Their Talent Abroad Yevgeny Kuznetsov World Bank Institute Labor Markets Course Washington, DC March 30, 2010

2 Table of Contents 1. Motivation 2. Promoting brain circulation 3. Lessons from successful initiatives 4. Conclusions

3 Motivation Market for the highly skilled Will become even more globally integrated Increasing returns to skills will continue to favor spatial concentration: clustering phenomenon The brain drain will increase, both from developed and developing countries Expansion of far-flung Diasporas networks of expatriates abroad

4 Top Skilled Emigration Countries Stock of tertiary-educated foreign-born residents in OECD (2000) All countries of origin 1 1,051,885 2 INDIA 996,813 3 PHILIPPINES 886,653 4 GERMANY 855,815 5 CHINA 799,834 6 MEXICO 473,923 7 S. KOREA 425, TAIWAN 263, IRAN 260, USSR-RUS 256, CUBA 221, ARGENTINA 105, CHILE 62,072

5 Proportion of Skilled Emigrants in the Total Stock Taiwan(China) 78.0 Qatar 69.6 Philippines 67.1 Mongolia 61.1 United States 54.4

6 Four Scenarios for Skills Be productively employed in the country: growth of clusters and non-traditional exports Leave the country and be lost for it: brain drain Leave the country yet be engaged in projects at home: brain circulation Leave and come back: return migration

7 Diversity of Skills (and respective Diaspora networks and initiatives ) Scientific Technical Medical professionals Entrepreneurial and managerial Cultural Tacit skills (not necessarily requiring higher education)

8 Common Mistakes Focus on the return of skills (physical reallocation to home countries): unrealistic for many countries Focus on scientists Instead: Create joint projects with skills abroad leverage brain circulation Focus on business and technical talent

9 Example: A story from Belarus A country with highly educated population and significant scientific schools but difficult business environment: brain drain (to Europe, Russia, US) From brain drain to circulation: a technology entrepreneur in US from Belarus recognizes opportunities at home: software producer EPAM is founded Now: 3000 employers with offices in USA, Hungary and Russia; a rapidly growing firm Born global firm (although from its website you will never guess where work is done)

10 How to trigger brain circulation? In many countries, Diasporas played a critical role In knowledge-based growth: China, India, Ireland Two ingredients of success: first generation overachiever (highly successful individual) from the skilled diaspora dynamic segments of economy at home Providers of venture capital and trade networks Indian experience Chinese approach to attract back high level migrants: Specialized technology parks

11 Example: Global Scot A program to manage enthusiasm to get involved of about 900 highly influential Scots all over the world A part of Scottish Enterprise Scottish Economic Development Agency A program with annual budget of about 300 thousand pounds A highly successful network of expatriate professionals due to a diversity of early success stories

12 Towards a virtuous cycle Emergence of innovation clusters and venture capital industry in Taiwan Massive foreign education and brain drain in the 60 s and 70 s Culture of risk-taking and experimentation virtually nonexisting Silicon Valley as a role model: successful entrepreneurs from Diaspora and the government decide to promote venture capital industry First venture capital fund is established. Expatriates reallocate to Taiwan to manage the Fund. Diaspora in Silicon Valley open up market Demonstration effect of the success triggers establishment of other funds

13 Source: Annalee Saxenian, University of California, Berkeley

14 Towards a virtuous cycle Is it the number s game? Do countries need large numbers of the Diaspora of talent to generate the Taiwan type dynamics? No. Smaller Diasporas of highly skilled can be very productive as well. Example: ChileGlobal: a network of about 100 successful professionals of Chilean origin in the US, Canada and Europe

15 Towards a virtuous cycle Tangible contributions of ChileGlobal: Co-founding of high-tech firms in Chile (example: Interlink) Synopsis creates a software development center in Chile (Raul Camposano Chief Technology Officer of Synopsis is a member of ChileGlobal) Involvement in peer review mechanisms

16 Hierarchy of Diaspora Impact Institutional Reform Knowledge & Innovation Investments Donations Remittances

17 Example from Egypt Coptic Orphans: Transforming Traditional Charity After visiting Coptic orphanages in Egypt, an Egyptian American began fundraising among US Coptic Churches with unexpected success and founded Coptic Orphans Innovation transfer through existing network: Program to pair volunteer women from the local community with younger girls, who receive financial assistance. Support of at-risk families Quality control of assisted kids, capacity building, financial reporting. Established offices in in Cairo, Australia, Canada and US, funding directly hundreds of local Coptic Churches in Egypt. Leveraging heterogeneity through commonalities: Egypt: Trusted institution, global network, shared values, clear needs Diaspora: Financial capacity, search for identity, will to share fortune

18 Emerging Lessons Many initiatives to establish brain gain networks have failed A lot of initial enthusiasm which dissipates. E.g.: Red Caldas of Colombia SANSA of South Africa Major lesson: Expatriate networks need to generate transactions (demonstration effects), people get tired of discussions New sources of promising experience: Chile, Armenia, Philippines

19 Hypotheses What is the logic of successful initiatives to promote brain circulation? Public sector should not be directly involved in diaspora programs, yet its role is critical Venture capital logic: many fail, majority remain living deads, very few are successful Successful initiative creates a search network linking exceptions from all sides Nourishing and developing promising ideas, rather than selecting or matching them

20 Organizational support Tension between Individual Creativity and Organisational Logic Top-down impulse Living dead Capture or stifling by vested interests Guided serendipity Elusive synergy Organizational support of projects Hit the wall Useful but tiny Heroic success Talent moves walls (Not replicable by definition) Individual initiative and creativity Bottom-up impulse

21 Hypotheses What is the logic of public sector involvement? Two-prong approach: Facilitate a diversity of initiatives from the bottom-up ( let one thousand flowers bloom ) Provide a framework for information sharing and lessons-learning Initiatives: Contests between domestic NGOs to leverage diaspora members for long-term projects. Examples: Russia, Mexico Similar programs in Morocco and Tunisia for temporary return of researchers.

22 Conclusions 1. Skilled diasporas can be very useful for home countries but to develop their potential, concerted effort is required. This concerted effort takes time. 2. In the short term, individual champions and tangible success stories (demonstration effects) are the key 3. In the longer-term, institutions of the home countries are the key (Diasporas are not a panacea) 4. Focus on pragmatism: relying on individual champions to develop institutions

23 Thank you Yevgeny Kuznetsov