The impact of temporary migration on human capital accumulation and economie development

We study the long-run growth impact on the emigrants' country of origin of a change in immigration policy implemented by the host country. The policy change takes the form of an increase in the ratio of temporary to permanent visas issued. This policy change has two counteracting effects on the source country: first, it discourages human capital accumulation (which is harmful for development), and second, it facilitates the diffusion of knowledge (which encourages growth). We are able to analyze the determinants of an “optimal” (i.e. growth-maximizing) share of temporary visas.