Abstract: Does the emigration of highly-skilled workers deplete local human capital?
The answer is not obvious if migration prospects induce human capital formation.
We analyze a unique natural quasi-experiment in the Republic of the Fiji Islands,
where political shocks have provoked one of the largest recorded exoduses of
skilled workers from a developing country. Mass emigration began unexpectedly
and has occurred only in a well-defined subset of the population, creating a
treatment group that foresaw likely emigration and two different quasi-control
groups that did not. We use rich census and administrative microdata to address a
range of concerns about experimental validity. This allows plausible causal
attribution of post-shock changes in human capital accumulation to changes in
emigration patterns. We show that high rates of emigration by tertiary-educated Fiji
Islanders not only raised investment in tertiary education in Fiji; they moreover
raised the stock of tertiary educated people in Fiji—net of departures.