Purpose – The purpose of this paper is to analyze the impact of interstate migration of individuals with different qualification levels on human capital formation in the migrant’s place of origin. Design/methodology/approach – A dynamic panel model with data from the National Household Sample Survey (Pesquisa Nacional por Amostra de Domicílios (PNAD)), between 2001 and 2013, is used. Findings – The results indicate that the migration of high-skilled people boosts school attendance in fifth grade elementary school and first year high school, but it does not affect the levels of those entering first year in higher education. However, the migration of low-skilled workers discourages people from entering higher education, as those living in less developed areas do not need higher education qualifications to get higher incomes. Thus, they migrate to developed areas with the education levels they already have. The brain gain hypothesis is not, therefore, confirmed in the context of higher education attendance. Originality/value – This paper’s contribution is its investigation into the effect of interstate migration on human capital formation in Brazil, through testing the brain gain hypothesis in a national context. In addition, it also analyzes the impact of the migration of people of low and intermediate qualification levels on human capital, with a view to verifying if the mobility of people with other levels of qualification could discourage the formation of human capital.

Introduction

The literature on economic growth considers that the accumulation of human capital is a decisive factor in determining growth. The mobility of such capital between regions can affect both human capital accumulation and the economic development of the different locations. Liu and Shen (2014) considered that an influx of people with high education levels can accelerate the accumulation of human capital, facilitate innovative activities and improve the potential for endogenous growth in the receiving areas. However, earlier studies on internal migration did not deal with migrants’ qualification levels, since they only considered the necessary transfer of labor surplus from rural to urban areas (Lewis, 1954; Todaro, 1969; Harris and Todaro, 1970). According to Bildirici et al. (2005), in the mid-1960s, when England began losing a significant number of people with high levels of schooling to North America and other countries, an interest in researching the migration of skilled labor was awakened. From then on, international literature has studied the phenomenon known as the brain drain, the migration of the skilled from developing to developed countries (Beine et al., 2008). Beine et al. (2011) considered the skilled to be those with post-secondary education, while Di Maria and Lazarova (2012) considered them as those with higher education. The literature on the brain drain considers that such migration has certain repercussions, especially for the migrant’s country of origin. Some authors claim that this migration damages these countries as it reduces the stock of human capital and affects the well-being of the remaining population (Grubel and Scott, 1966; Bhagwati and Hamada, 1974). However, from the 1990s onwards, authors, such as Mountford (1997), Vidal (1998) and Beine et al. (2001, 2008, 2011), proposed new approaches, according to which the migration of the skilled from developing to developed countries stimulates the formation of human capital in their country of origin. This became known as beneficial brain drain or brain gain. As the returns from education are higher abroad (in the migrant’s country of destination), Beine et al. (2008) claimed that migration perspectives can induce more people to invest in education at home, with a view to migrating in the future. Such an occurrence would have an incentive effect (called brain gain), which could be superimposed on actual emigration and lead to a net gain for the source country (beneficial brain drain). In the context of internal migration, where barriers to mobility tend to be lower, people are induced to seek higher remuneration for acquired human capital and can leave their state of origin (Bezerra and Silveira Neto, 2008). When such people have higher education levels and migrate to more developed regions, there can be a brain drain, whose consequences for the source areas could be similar to those of international skilled migration.