Consequences of a tax on the brain drain for unemployment and income inequality in less developed countries |
| |
Authors: | Rachel McCulloch Janet L Yellen |
| |
Institution: | Harvard University, Cambridge, MA 02138, U.S.A. |
| |
Abstract: | Welfare implications of an income tax paid by emigrant skilled workers are analyzed in a model which assumes international capital mobility and allows for unemployed labor in the modern sector of a developing country. The tax discourages overinvestment in education and also contributes to the welfare of those remaining through the direct revenue effect. However, expected earnings of unskilled workers decline as a result of the tax, while those of non-migrant skilled workers rise. The tax may thus exacerbate domestic income inequality. In addition, modern sector employment, output, and capital stock may fall. |
| |
Keywords: | |
本文献已被 ScienceDirect 等数据库收录! |
|