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The News

Published Date: Jul 10, 2012

SOCIAL COSTS MORE THAN SOCIAL BENEFITS

Dr Shahrukh Rafi Khan, Visiting Professor of Economics, Mount Holyoke College, USA, and former executive director, Sustainable Development Institute, has said that the flight of highly educated persons to high-income countries can be converted into gain if the states play a proactive role to tap the potentials of highly educated diaspora.

Dr Rafi was speaking at a special lecture on ‘Highly educated emigration from low-income countries: turning pain to gain’, organised by SDPI to commemorate its 20th anniversary celebrations. SDPI Executive Director Dr Abid Qaiyum Suleri moderated the proceedings.

Refuting the aid agencies argument of lack of capacity in the low-income countries, Dr Rafi said that tapping the expatriate community would be easier because of the element of volunteerism and aspiration to serve their country and more effective given the linguistic and cultural advantages.

He observed that the monetary returns are likely to be higher in high-income countries but the social costs of migration are far greater than the social benefits. He referred to both push and pull factors directly affecting the process of emigration. He said the most important pull factor behind the high education migration is the wage differential.

However, the better social facilities, social and workplace freedoms, and opportunities for children also contribute massively in this process. He said that some of the push factors in LICs hinder individuals from realising their productive potential besides social and political chaos, conflicts, or civil insecurity induced by inefficient policing and legal mechanisms play important role in encouraging the emigration trends.

Dr Rafi argued there is very high cost attached to emigration of highly skilled persons for a society. Such emigration affects country’s growth potential as loss of highly educated people reduce the economic growth rates which has a strong relevance with prosperity. He said, the costs of subsidised higher education are borne by the home and hence the migration represents a loss of social investment since the benefits accrue to the host country.

He said that migration of upper tax brackets cause reduction in tax revenues for the source country. He termed the “remittances as a mixed blessing” because they overvalue exchange rate and subsequently hurt the exports and result into de-industrialisation.

He proposed alternate mechanism to turn social pain of highly educated emigration into social gain through market-based, non-profit, state-based and multilateral mechanisms. He said, the gains could be based on the flows of knowledge and technical assistance or the promotion of trade by the expatriate community. He also urged on enforcing a tax on highly educated immigrants, foreign direct investment or portfolio investments by expatriate communities in the country of their origin.

He called upon high income countries to introduce programmes like US Fulbright-Hays Programme and scale-up initiative such as UNDP’s TOKTEN programme, which encourage diaspora from low income countries to volunteer their expertise in their country of origin. “Voluntary short term or long term return could transfer knowledge, technology, work habits and contribute to a social transformation.”