Document Type



Taxation-Transnational | Tax Law


Emigration results in the loss of skilled manpower for many countries. The widespread movement of skilled workers (PTKs) from less developed countries (LDCs) to developed countries (DCs) is particularly concerning. This emigration, referred to as the “brain drain”, creates two major concerns for LDCs: (1) slowing economic development, and (2) exploitation by DCs. As a result, LDCs have a growing resentment toward DCs, which leads to irrational discussion and a lack of solutions. The absence of reliable statistics has also greatly impeded progress.

This article discusses proposals for solutions to the brain drain issue. Part I addresses the problem, and analyzes two theories of the brain drain: the internationalist and nationalist theories. DC economists promote the internationalist theory, whereas the LDCs espouse the nationalist theory. Section II proposes three types of solutions to the brain drain: (1) tax incentives to encourage voluntary contributions by PTKs and their employers to LDCs, (2) a special tax on PTKs levied by either the LDCs or the United Nations, and (3) a United Nations assessment of immigration on the DCs. Section III applauds the efforts of Professor Bhagwati, and urges the consideration of a United Nations assessment on DCs and tax incentives for voluntary contributions to LDCs. The article concludes by explaining that the recent UNCTAD meeting represented an important step toward consensus between the LDCs and DCs, even if the DCs are unlikely to adopt any of the proposals.