Person: Rapoport, Hillel
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Rapoport
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Hillel
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Rapoport, Hillel
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Publication Remittances and the Brain Drain Revisited: The microdata show that more educated migrants remit more(Center for International Development at Harvard University, 2009-12) Bollard, Albert; McKenzie, David; Morten, Melanie; Rapoport, HillelTwo of the most salient trends surrounding the issue of migration and development over the last two decades are the large rise in remittances, and an increased flow of skilled migration. However, recent literature based on cross-country regressions has claimed that more educated migrants remit less, leading to concerns that further increases in skilled migration will hamper remittance growth. We revisit the relationship between education and remitting behavior using microdata from surveys of immigrants in eleven major destination countries. The data show a mixed pattern between education and the likelihood of remitting, and a strong positive relationship between education and the amount remitted conditional on remitting. Combining these intensive and extensive margins gives an overall positive effect of education on the amount remitted. The microdata then allow investigation as to why the more educated remit more. We find the higher income earned by migrants, rather than characteristics of their family situations explains much of the higher remittances.Publication Migrant Inventors and the Technological Advantage of Nations(2020-11) Bahar, Dany; Choudhury, Prithwiraj; Rapoport, HillelWe investigate the relationship between the presence of migrant inventors and the dynamics of innovation in the migrants’ receiving countries. We find that countries are 25 to 60 percent more likely to gain advantage in patenting in certain technologies given a twofold increase in the number of foreign inventors from other nations that specialize in those same technologies. For the average country in our sample, this number corresponds to only 25 inventors and a standard deviation of 135. We deal with endogeneity concerns by using historical migration networks to instrument for stocks of migrant inventors. Our results generalize the evidence of previous studies that show how migrant inventors "import" knowledge from their home countries, which translates into higher patenting in the receiving countries. We interpret these results as tangible evidence of migrants facilitating the technology-specific diffusion of knowledge across nations.Publication Migration and cross-border equity portfolio flows(Center for International Development at Harvard University, 2011-07) Kugler, Maurice; Rapoport, HillelThe gravity model has provided a tractable empirical framework to account for bilateral flows not only of manufactured goods, as in the case of merchandise trade, but also of portfolio assets. In particular, Portes and Rey (2005) show that the gravity model successfully accounts for the pattern of cross-border equity portfolio flows. The interpretation given to the negative coefficient on the distance measure in this context is not that distance proxies for transportation costs but rather that it proxies for information costs. Thus, information asymmetries are more severe when investors consider acquiring equity in assets based in far flung locations. In this paper, we explore to what extent migration plays a role in mitigating such informational asymmetries (indeed, migrants can convey information about assets in their country of origin to investors based in the destination country) and find that migration, and especially skilled migration, is associated with larger cross-border equity investment from the destination country of the migrant into assets based at the origin country of the migrant. We interpret these results as providing further evidence of the role of information asymmetries in explaining cross-border equity portfolio flows, and of the instrumental role of skilled migrants in promoting capital inflows to their home country.Publication Birthplace Diversity and Economic Prosperity(2015) Alesina, Alberto; Harnoss, Johann; Rapoport, HillelWe propose an index of population diversity based on peopleís birthplaces and decompose it into a size (share of immigrants) and a variety (diversity of immigrants) component. We show that birthplace diversity is largely uncorrelated with ethnic, linguistic or genetic diversity and that the diversity of immigration relates positively to measures of economic prosperity. This holds especially for skilled immigrants in richer countries at intermediate levels of cultural proximity. We address endogeneity by specifying a pseudo-gravity model predicting the size and diversity of immigration. The results are robust across specifications and suggestive of skill-complementarities between immigrants and native workers.Publication Globalization, Brain Drain and Development(Center for International Development at Harvard University, 2011-03) Docquier, Frédéric; Rapoport, HillelThis paper reviews four decades of economics research on the brain drain, with a focus on recent contributions and on development issues. We first assess the magnitude, intensity and determinants of the brain drain, showing that brain drain (or high-skill) migration is becoming the dominant pattern of international migration and a major aspect of globalization. We then use a stylized growth model to analyze the various channels through which a brain drain affects the sending countries and review the evidence on these channels. The recent empirical literature shows that high-skill emigration need not deplete a country's human capital stock and can generate positive network externalities. Three case studies are also considered: the African medical brain drain, the recent exodus of European scientists to the United States, and the role of the Indian diaspora in the development of India's IT sector. We conclude with a discussion of the implications of the analysis for education, immigration, and international taxation policies in a global context.Publication Tradable Immigration Quotas(Center for International Development at Harvard University, 2011-06) Mortaga, Jesus Fernandez-Huertas; Rapoport, HillelInternational migration is maybe the single most effective way to alleviate poverty at a global level. When a given host country allows more immigrants in, this creates costs and benefits for that particular country as well as a positive externality for all those (individuals and governments) who care about world poverty. This implies that the existing international migration regime is inefficient as it fails to internalize such externality. In addition, host countries quite often restrict immigration due to its apparently unbearable social and political costs. However these costs are never measured and made comparable across countries. In this paper we first discuss theoretically how tradable immigration quotas (TIQs) can reveal information on such costs and, once coupled with a matching mechanism taking into account migrants' preferences, generate substantial welfare gains for all the parties involved. We then propose two potential applications: a market for the resettlement of international (e.g., climate change) refugees, and an extension of the US diversity lottery to a larger set of host countries and other immigration targets. Both applications are seen as possible precursors to a full implementation of a TIQs system.Publication Migrant Investors and the Technological Advantage of Nations(Center for International Development at Harvard University, 2020-02) Bahar, Dany; Choudhury, Prithwiraj; Rapoport, HillelWe investigate the relationship between the presence of migrant inventors and the dynamics of innovation in the migrants’ receiving countries. We find that countries are 25 to 60 percent more likely to gain advantage in patenting in certain technologies given a twofold increase in the number of foreign inventors from other nations that specialize in those same technologies. For the average country in our sample, this number corresponds to only 25 inventors and a standard deviation of 135. We deal with endogeneity concerns by using historical migration networks to instrument for stocks of migrant inventors. Our results generalize the evidence of previous studies that show how migrant inventors "import" knowledge from their home countries, which translates into higher patenting in the receiving countries. We interpret these results as tangible evidence of migrants facilitating the technology-specific diffusion of knowledge across nations.Publication Does Birthplace Diversity Affect Economic Complexity? Cross-country Evidence(Center for International Development at Harvard University, 2020-03) Bahar, Dany; Rapoport, Hillel; Turati, RiccardoWe empirically investigate the relationship between a country’s economic complexity and the diversity in the birthplaces of its immigrants. Our cross-country analysis suggests that countries with higher birthplace diversity by one standard deviation are more economically complex by 0.1 to 0.18 standard deviations above the mean. This holds particularly for diversity among highly educated migrants and for countries at intermediate levels of economic complexity. We address endogeneity concerns by instrumenting diversity through predicted stocks from a pseudo-gravity model as well as from a standard shift-share approach. Finally, we provide evidence suggesting that birthplace diversity boosts economic complexity by increasing the diversification of the host country’s export basket.Publication Migration and Post-conflict Reconstruction: The Effect of Returning Refugees on Export Performance in the Former Yugoslavia(Center for International Development at Harvard University, 2019-11) Bahar, Dany; Hauptmann, Andreas; Özgüzel, Cem; Rapoport, HillelDuring the early 1990s Germany offered temporary protection to over 700,000 Yugoslavian refugees fleeing war. By 2000, many had been repatriated. We exploit this natural experiment to investigate the role of migrants in post-conflict reconstruction in the former Yugoslavia, using exports as outcome. Using confidential social security data to capture intensity of refugee workers to German industries–and exogenous allocation rules for asylum seekers within Germany as instrument—we find an elasticity of exports to return migration between 0.08 to 0.24. Our results are stronger in knowledge-intensive industries and for workers in occupations intensive in analytical and managerial skills.Publication Migration, FDI and the Margins of Trade(Center for International Development at Harvard University, 2011-06) Kugler, Maurice; Rapoport, HillelStandard neoclassical trade theory models trade, migration and FDI as substitutes in the sense that factor movements reduce the scope for trade and vice versa. This neglects the potential for migration to favor trade and FDI through a reduction in bilateral transaction costs, as emphasized by recent literature on migration and diaspora networks. This paper investigates the relationships between trade, migration and FDI in a context of firms' heterogeneity. We first present a model of exports and FDI-sales by heterogeneous firms where a (migration-induced) reduction in the fixed costs of setting up either an export or a production facility abroad results in an increase in trade (under certain conditions), FDI-sales and most importantly in the FDI-sales to trade ratio. We then test these predictions in a gravity framework using recent bilateral data on migration, trade and FDI. We find that migration – and especially skilled migration -- positively affects trade and FDI (at both the extensive and intensive margins), and more so for the latter, resulting in an increase in the FDI to trade ratio, as predicted by our model.