Skilled Migration and the Transfer of Institutional Norms

This paper examines the impact of international emigration on the evolution of the quality of institutions in the origin countries. We allow for two broad channels of impact on origin country institutions. One relates to the direct and indirect impact of emigration through usual mechanisms like the exit/voice mechanisms. The second relates to the transfer of norms from the Diaspora to the natives of the origin country. We test those impacts on four different indicators of institutional quality using new cross-country data over the 1990-2000 period. Our results provide support for an impact of the brain drain on institutions and a strong support for the transfer of norms from the diaspora. We document the robustness of those main conclusions through the use of alternative econometric methods and through the use of alternative samples involving developed or developing countries.