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Increases (respectively decreases) in leads to increases (decreases) in the relative net
human capital gains.
The optimal emigration rate increases (decreases respectively) with increases (decreases)
of the relative wages (wage in destination relative to that at the origin). The optimal rate
of emigration changes also in the same direction with changes in .
The level of m that equates HN with H0
This level is given by:
This is achieved with m=0, with HN = H0 and with m=m* because of the concavity of HN.
This implies that m** is given by the second zero of the following equation:
The values of m** indicate how the economy enters the net brain drain phase. The higher
is m**, the better off is the economy as the brain drain occurs at higher probabilities of
emigration. Lower m** is an indication of higher brain drain and then the sensitiveness
of the economy to the loss.
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