Blog post

Brainless recovery - brain drain in the aftermath of the crisis

Throughout the 2000s, European countries have been broadly successful at attracting large numbers of highly-skilled individuals. The euro area crisis

Publishing date
18 December 2014
Alessio Terzi

This blog post presents some of the broader findings of a chapter written for ‘The Handbook of Global Science, Technology, and Innovation’ (Archibugi D. and Filippetti A. eds.). The Handbooks of Global Policy series, Wiley-Blackwell, forthcoming 2015.

Over the past decade, as part of a broader globalisation trend, migration has been intensifying at global level. The number of migrants (aged 15+) in OECD countries increased by 38% between 2000 and 2010, to 106 million (see Arslan et al., 2014). Of these, about 35 million had tertiary education. However, some countries were more successful at attracting and retaining highly-educated workers than others. Although far from perfect, this measure can give us a sense of whether a country is on balance a brain gainer.

Building on the Database of Immigrants in OECD countries (DIOC), released a few weeks ago, Figure 1 details the net flow (immigrants minus emigrants) of highly-educated workers for selected OECD countries in 2010, normalized by population. Several interesting trends can be identified: (i) small countries at the heart of Europe (Switzerland, Luxembourg) had a particularly positive balance; (ii) within Europe, among the large countries, the UK was a top brain gainer; (iii) Ireland and Finland, in 2010, were seeing a larger outflow than inflow of highly-educated individuals.

Source: OECD, own calculations


Data on migration by educational attainment level is currently available only up to 2010. Although in normal times this would not be a major problem, given that migration patterns tend to be relatively stable in time, at the current juncture 2010 sounds like a remote past. As suggested by Machado and Walsh (2014), the euro area crisis, with its disruptive effects on the labour market and growth rates in several countries, is likely to have acted as a structural change also in terms of migration patterns of the highly educated. As now countries progressively return to growth, it will be interesting to observe whether these changes in migration patterns will prove temporary in nature or more permanent.

In certain European countries, my hunch is they will not be temporary. Veugelers (2014) shows how fiscal consolidation has led countries that were already ‘innovation laggards’ within the EU to cut disproportionately their Research and Innovation (R&I) expenditure with respect to other categories of public expenditure. Lower private and public spending on research is likely to have a significant impact on the capacity of countries to attract and retain talents in the longer term. With no pretence to trace a direct causality link, Figures 2 and 3 (below) illustrate the strong correlation between highly-skilled migration flows and R&D expenditure (both public and private).

Note: Emigration rates are constructed as the ratio of high-education emigrants over the number of people within their origin country with similar educational characteristics (taken from Barro and Lee, 2013).

Source: OECD, own calculations


What the charts illustrate is that low spending on R&D is correlated both with a weaker pull factor (capacity to attract talents) and a stronger push factor (retaining talents). Survey evidence [1] on the mobility determinants of researchers somewhat points in a similar direction: career progression, research funding, facilities, and equipment (all of which are likely to be highly associated with R&D spending) appear among the top reasons for moving both to another EU country and outside the EU.

A country that gives a high priority to R&D is one that is likely to generate growth in innovative sectors over the medium to long term (see Veugelers, 2014). This is true for both the public sector (within universities’ fields of research) and the private sector (in innovative business sectors). In turn, an economy where growth originates from innovative sectors is well placed to attract talents from abroad or create jobs for the highly-qualified individuals it has trained.  As such, one can envision that countries in the EU periphery where R&D spending has been slashed will see a higher incidence of brain drain in the years to come. Veugelers (2014) suggests these to be Ireland, Spain, Italy, and Greece.

Interestingly, Veugelers (2014) shows how also the UK saw its R&I spending slashed over the period 2007-2012. This, coupled with the potential for tougher migration laws, could harm the country’s position as a leading brain gainer in Europe going forward.

The impact of R&D on innovation, migration patterns, research facilities, and high-skilled wages is likely to manifest only over long periods of time. As such, our analysis traces the likely scenario for these European countries only in the case in which the cuts to R&D spending are not reversed: something that would be advisable, as fiscal space materialises.

Research assistance by Alvaro Leandro is gratefully acknowledged.


About the authors

  • Alessio Terzi

    Alessio Terzi, an Italian citizen, joined Bruegel in October 2013. Prior to this, Alessio was a Research Analyst in the EMU governance division of the European Central Bank. He has also worked for the macroeconomic forecasting unit of DG ECFIN (European Commission), the Scottish Parliament’s Financial Scrutiny Unit, and BMI Research (Fitch group), a country risk and forecasting firm in the City of London, where he was a Europe Analyst.

    He holds a Bachelor's degree in International Economics from Bocconi University and an MPA in European Economic Policy from the London School of Economics, where he specialised in public economics. During his studies, he spent a semester at Dartmouth College (USA). Alessio’s main research interests include structural reforms, competitiveness, EMU governance, and the G20.

    Between 2016-2018, Alessio was a Visiting Fulbright Fellow at the Kennedy School of Government of Harvard University. He completed a PhD in Political Economy at the Hertie School of Governance in Berlin, with a thesis on economic growth, written under the supervision of prof. Henrik Enderlein, Dani Rodrik, and Jean Pisani-Ferry.

    He is fluent in Italian and English, has a good knowledge of French, and an intermediate level of German and Spanish.

    Declaration of interests 2015

    Declaration of interests 2016

    Declaration of interests 2017

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