nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2011‒11‒01
twenty papers chosen by
Giuseppe Marotta
University of Modena and Reggio Emilia

  1. The EU Emission Trading Scheme. Allocation Patterns and Trading Flows By Claudia Kettner; Daniela Kletzan-Slamanig; Angela Köppl
  2. Job Quality and Employment of Older People in Europe By Rudolf Winter-Ebmer; Mario Schnalzenberger; Nicole Schneeweis; Martina Zweimüller
  3. More Schooling, More Children: Compulsory Schooling Reforms and Fertility in Europe By Fort, Margherita; Schneeweis, Nicole; Winter-Ebmer, Rudolf
  4. Does Institutional Diversity Account for Pay Rules in Germany and Belgium? By Kampelmann, Stephan; Rycx, Francois
  5. Education and Earnings Differentials: The Role of Family Background Across European Countries By Rosalia Castellano; Gennaro Punzo
  6. The French Unhappiness Puzzle: the Cultural Dimension of Happiness By Senik, Claudia
  7. The Gender Wage Gap among recent European Graduates By Moris Triventi
  8. Overeducation and Local Labour Markets in Spain By Ramos, Raul; Sanromá, Esteban
  9. Coordinating cross-border congestion management through auctions : An experimental approach to European solutions By Céline Jullien; Virginie Pignon; Stéphane Robin; Carine Staropoli
  10. Work-Related Health in Europe: Are Older Workers More at Risk? By Jones, Melanie K.; Latreille, Paul L.; Sloane, Peter J.; Staneva, Anita V.
  11. The Old Boy Network: Gender Differences in the Impact of Social Networks on Remuneration in Top Executive Jobs By Lalanne, Marie; Seabright, Paul
  12. "Air services on thin routes: Regional versus low-cost airlines" By Xavier Fageda; Ricardo Flores-Fillol
  13. Personnel policies in the European firms: some evidence of the existing model(s) and the potential role of Corporate Universities. By Giulio Pedrini
  14. Multi-level innovation policy in southern EU countries.An additionality evaluation of the Italian and Spanish public interventions By Alberto Marzucchi
  15. No Protectionist Policy Before and During the Great Recession By Hylke Vandenbussche; Christian Viegelahn;
  16. Bachelor degree owners’ employment in Italy and in other European Countries By Giunio Luzzatto; Stefania Mangano; Roberto Moscati
  17. Regulation, Privatization, and Airport Charges: Panel Data Evidence from European Airports By Bilotkach, Volodymyr; Clougherty, Joseph A.; Mueller, Juergen; Zhang, Anming
  18. Professional and personal paths for Europe’s qualified youth A survey of French, Italian and English ex-Erasmus students’ trajectories By Magali Ballatore
  19. Sub-field normalization in the multiplicative case: average-based citation indicators By Neus Herranz; Javier Ruiz-Castillo
  20. The `Brain Gain Hypotheses` of Transition Countries Elites and Socioeconomic Development in Their Home Country (Albanian Emigrants in Italy Sample) By Brunilda Zenelaga; Kseanela Sotirofski

  1. By: Claudia Kettner (WIFO); Daniela Kletzan-Slamanig (WIFO); Angela Köppl (WIFO)
    Abstract: The EU Emission Trading Scheme (EU ETS) that covers emitters from industry and the energy sector representing 40 percent of the EU's total greenhouse gas emissions is the biggest implementation worldwide of a cap-and-trade scheme. The EU ETS has been the core instrument of European climate policy since its start in 2005. Based on a database comprising more than 10,000 installations in 26 EU countries, this paper provides a thorough analysis of the performance of the EU ETS in the period 2005 to 2010. In the first part, we analyse allocation patterns – i.e., the stringency of allocation caps and distribution issues – on EU country and sector level comparing the results of the EU ETS pilot phase and the first three years of the Kyoto phase. In the second part of the paper, we assess trading flows of European Allowance Units (EUAs) between EU countries comparing the results for the first and second trading period. Furthermore, we analyse the use of credits from flexible mechanisms – Certified Emission Reductions (CERs) from CDM projects and Emission Reduction Units (ERUs) from JI projects – that installations may surrender since the beginning of the second trading period on country level.
    Date: 2011–10–17
  2. By: Rudolf Winter-Ebmer; Mario Schnalzenberger (Department of Economics, Johannes Kepler University Linz, Austria); Nicole Schneeweis; Martina Zweimüller
    Abstract: We study the relationship between job quality and retirement using panel data for European countries (SHARE). While previous studies looked at the impact of bad working conditions on retirement intentions, we can use the panel dimension to study actual retirement as well as other pathways out of a job. As indicators for job quality we use three different approaches: overall job satisfaction, over- and undereducation for a particular job as well as effort-reward imbalance which measures the imbalance between a worker's effort and the rewards he or she receives in turn.
    Keywords: retirement, job quality, job satisfaction, educational mismatch, effort-reward imbalance, SHARE
    JEL: J14 J18 J26 J28
    Date: 2011–07
  3. By: Fort, Margherita (University of Bologna); Schneeweis, Nicole (University of Linz); Winter-Ebmer, Rudolf (University of Linz)
    Abstract: We study the relationship between education and fertility, exploiting compulsory schooling reforms in Europe as source of exogenous variation in education. Using data from 8 European countries, we assess the causal effect of education on the number of biological kids and the incidence of childlessness. We find that more education causes a substantial decrease in childlessness and an increase in the average number of children per woman. Our findings are robust to a number of falsification checks and we can provide complementary empirical evidence on the mechanisms leading to these surprising results.
    Keywords: instrumental variables, education, fertility
    JEL: I2 J13
    Date: 2011–10
  4. By: Kampelmann, Stephan (University of Lille 1); Rycx, Francois (Free University of Brussels)
    Abstract: This paper examines the relationship between institutions and the remuneration of different jobs by comparing the German and Belgian labour markets with respect to a typology of institutions (social representations, norms, conventions, legislation, and organisations). The observed institutional differences between the two countries lead to the hypotheses of (I) higher overall pay inequality in Germany; (II) higher pay inequalities between employees and workers in Belgium; and (III) higher (lower) impact of educational credentials (work-post tenure) on earnings in Germany. We provide survey-based empirical evidence supporting hypotheses I and III, but find no evidence for hypothesis II. These results underline the importance of institutional details: although Germany and Belgium belong to the same "variety of capitalism", we provide evidence that small institutional disparities within Continental-European capitalism account for distinct structures of pay.
    Keywords: labour market institutions, wage inequality, rules, collective bargaining
    JEL: J31 J51 J52 J53
    Date: 2011–10
  5. By: Rosalia Castellano (Department of Statistics and Mathematics for Economic Research, University of Naples Parthenope); Gennaro Punzo (Department of Statistics and Mathematics for Economic Research, University of Naples Parthenope)
    Abstract: The crucial aim of this paper is to investigate, in a generational perspective, the effects of specific dimensions of human capital on individuals earnings and earnings differentials across a selected set of six developed economies of Western Europe with structural differences in their formal education systems and, more generally, in their institutional frameworks. In a cross-country comparison, we intend to inspect how formal education and work experience stand for critical predictors of inequality between and within earner-groups and/or educational groups. In this light, the role of family background on individuals’ earnings in relation to the two main occupational status (i.e., wage-employment rather than self-employment) and, in particular, the impact of parental education and abilities on children’s human capital are argued as well. In order to look into the critical determinants of intergenerational im-mobility, in terms of educational and employment decision-making process, and to what extent they vary across countries, two-stage structural probit models with quantile regressions in the second stage are estimated. As we expect that individual earnings also depend on a range of personal and structural factors and on the family background as well, a set of human capital earnings equations, based on extensions of Mincer models, are estimated by the main employment status. Microdata come from EU-SILC survey, the main new reference source for comparative statistics at European level, which also detects a set of retrospective parental information allowing to account for potential generational changes over time. Briefly, empirical results are interesting, taken as a whole. Although not a few determinants appear to be relatively similar across countries, wider national-specific differentials are drawn. Most of all, it emerges how each component of human capital differently affects individuals’ earnings and earnings inequality across European countries and, most importantly, how this impact differs along the whole earnings distributions. Also, quite dissimilar patterns of influence of family-specific background on children’s outcomes across countries is sketched.
    Date: 2011–09
  6. By: Senik, Claudia
    Abstract: This article sheds light on the important differences in self-declared happiness across countries of equivalent affluence. It hinges on the different happiness statements of natives and immigrants in a set of European countries to disentangle the influence of objective circumstances versus psychological and cultural factors. The latter turns out to be of non- negligible importance in explaining international heterogeneity in happiness. In some countries, such as France, they are mainly responsible for the country’s unobserved idiosyncratic source of (un-)happiness.
    Keywords: Happiness; Subjective Well-Being; International Comparisons; France; Immigration; European Social Survey
    JEL: I31 H52 O15 O52 Z10
    Date: 2011–10
  7. By: Moris Triventi (Department of Sociology and social research University of Milano-Bicocca)
    Abstract: The aim of this paper is to examine whether there is a gender gap in monthly wage among recent graduates in eleven European countries and which variables can explain it. In the first part of the paper previous literature is presented and some limitations of existing studies are discussed. In the theoretical framework the gender wage gap is conceived as a function of five main factors: human capital, employment characteristics, working hours, work-family conciliation aspects and residual discrimination. Different types of decomposition after OLS linear regression and Heckman selection models are applied; data comes from REFLEX survey on tertiary graduates in 2000. The main results indicate that the raw gender gap is higher in Austria and Germany, while it is lower in Belgium and United Kingdom, with Southern and Nordic countries placed in the middle. There is great variability in the unexplained part of the gender gap, which is mainly imputable to residual discrimination. This is low in Nordic countries, followed by Continental and Southern Europe. Overall the most important factors accounting for the gender gap are employment characteristics, followed by working hours. Human capital, work-family conciliation issues and individuals’ preferences matter in most countries, but their role is not prominent. There is also evidence of a correlation between several macro-institutional indicators (type of wage-setting institutions and welfare policies) and the extent of the gender gap, suggesting that wage determination is deeply rooted into institutional contexts.
    Date: 2011–09
  8. By: Ramos, Raul (University of Barcelona); Sanromá, Esteban (University of Barcelona)
    Abstract: The objective of this paper is to analyze the influence of individual variables and some characteristics related to spatial mobility in regional labour markets on overeducation in Spain. With this aim, we use microdata from the Spanish Budget Family Survey to estimate a logit model for overeducation probability taking into account the problem of selection bias and the presence of data of different levels (individuals and territory). The obtained results permit us to conclude that the size of local labour markets and the possibility of extending the job search to other labour markets through commuting are relevant factors to explain overeducation in the Spanish labour market. In spite of the differences in terms of labour market institutions, our results are very similar to the ones obtained for other countries.
    Keywords: educational mismatch, Spain, multilevel, commuting, job mismatch, differential overeducation
    JEL: J61 J24 J31
    Date: 2011–10
  9. By: Céline Jullien (Grenoble Ecole de Management, 12 rue Pierre Sémard, 38003 Grenoble, Cedex 01, France); Virginie Pignon (Electricité de France); Stéphane Robin (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France); Carine Staropoli (University Panthéon Sorbonne, Centre d’Economie de la Sorbonne, 106 boulevard de l’Hôpital Bureau 514, 75013 Paris, France)
    Abstract: Competition among producers within an integrated electricity system is impeded by any limited transmission capacity there may be at its borders. Two alternative market mechanisms have recently been designed to organize the allocation of scarce transmission capacity at cross-border level : (i) the “implicit auction”, already used in some countries, and (ii) the “coordinated explicit auction”, proposed by the European Transmission System Operators (ETSO) but not implemented yet. The main advantage of the explicit auction is that it allows each country to keep its own power exchange running. In the European institutional context, this is seen as a factor of success of a market reform, although the explicit auction (not coordinated) is known to be less efficient than the implicit mechanism. The addition of a coordination dimension in the explicit auction is intended to solve problems of international flows. We use an experimental methodology to identify and compare in a laboratory setting the efficiency properties of these two market mechanisms, given a market structure similar to the existing one in continental Europe, i.e. a competitive oligopoly. Our main result highlights the inefficiency of the coordinated explicit auction compared to the performance of the implicit auction, measured in terms of both energy prices and transmission capacity allocation. We suggest that the poor performance of the coordinated explicit auction in the laboratory is due to the level of individual expectations about both energy and transmission prices that the mechanism demands. One solution to resolve this problem when the mechanism is implemented in the field would be to design an additional and secondary market for “used” transmission capacity.
    Keywords: auctions; congestion management; electricity markets; experimental economics
    JEL: C92 D43 D44 D49
    Date: 2011
  10. By: Jones, Melanie K. (Swansea University); Latreille, Paul L. (Swansea University); Sloane, Peter J. (Swansea University); Staneva, Anita V. (Swansea University)
    Abstract: This paper uses the fourth European Working Conditions Survey (2005) to address the impact of age on work-related self-reported health outcomes. More specifically, the paper examines whether older workers differ significantly from younger workers regarding their job-related health risk perception, mental and physical health, sickness absence, probability of reporting injury and fatigue. Accounting for the 'healthy worker effect', or sample selection – in so far as unhealthy workers are likely to exit the labour force – we find that as a group, those aged 55-65 years are more 'vulnerable' than younger workers: they are more likely to perceive work-related health and safety risks, and to report mental, physical and fatigue health problems. As previously shown, older workers are more likely to report work-related absence.
    Keywords: endogeneity, fatigue, absence, physical health, mental health, healthy worker selection effect
    JEL: I0 J28 J81 J20
    Date: 2011–10
  11. By: Lalanne, Marie; Seabright, Paul
    Abstract: Using an original dataset describing the career history of some 16,000 senior executives and members of the non-executive board of US, UK, French and German companies, we investigate gender differences in the use of social networks and their impact on earnings. There is a large gender wage gap: women (who make up 8.8% of our sample) earned average salaries of $168,000 in 2008, only 70% of the average $241,000 earned by men. This is not due to differences in age, experience or education levels. Women are more likely than men to be non-executives, whose salaries are lower; nevertheless, a substantial gender gap still exists among executives. We construct measures of the number of currently influential people each individual has encountered previously in his or her career. We find that executive men's salaries are an increasing function of the number of such individuals they have encountered in the past while women's are not. Controlling for this discrepancy, there is no longer a significant gender gap among executives. These findings are robust to the use of different years, to the use of salaried versus non-salaried remuneration, and to the use of panel estimation to control rigorously for unobserved individual heterogeneity. In contrast to executives, the salaries of non-executive board members do not display a significant gender wage gap, nor any gender difference in the effectiveness with which men and women leverage their links into salaries. This suggests that adoption of gender quotas for board membership, as has been enacted or proposed recently in several European countries, is unlikely to reduce the gender gap in earnings so long as such quotas do not distinguish between executive and non-executive board members.
    Keywords: executive compensation; gender wage gap; social networks
    JEL: A14 J16 J31 J33
    Date: 2011–10
  12. By: Xavier Fageda (Faculty of Economics, University of Barcelona); Ricardo Flores-Fillol (Universitat Rovira i Virgili)
    Abstract: An examination of the impact in the US and EU markets of two major innovations in the provision of air services on thin routes - regional jet technology and the low-cost business model - reveals significant differences. In the US, regional airlines monopolize a high proportion of thin routes, whereas low-cost carriers are dominant on these routes in Europe. Our results have different implications for business and leisure travelers, given that regional services provide a higher frequency of flights (at the expense of higher fares), while low-cost services offer lower fares (at the expense of lower flight frequencies).
    Keywords: air transportation; regional jet technology; low-cost business model; thin markets JEL classification:L13; L2; L93
    Date: 2011–10
  13. By: Giulio Pedrini (Department of Economics, University of Bologna; SDIC, School of Innovation Development and Change, Bologna)
    Abstract: This study deals with the attitude of European firms towards personnel policies analysed on a national basis. Provided the relevance of Human Resources (HR) practices in terms of the internal organisation of knowledge of the firm, we assess the main characteristic of personnel policies in 12 European countries both in terms of HR department position within the firm and in terms of human capital development practices. Not only is the issue significant in terms of Human Resource Management but also in terms of the debate on the role of the institutions in determining personnel policies, and notably in terms of the debate on the "varieties of capitalism”. For this purpose the paper develops a cluster analysis among 16 European countries showing the possible influence of institutional models on personnel policies. The same analysis is also developed for intertemporal comparative purposes. The second part of the paper analysis relates personnel policies to the phenomenon of Corporate Universities (CU), being they intended as a vehicle of firms’ capability to react to organisational and technological change. Within the complex relationship between firm’s organization and knowledge CU may in fact represent a consistent way to keep HR departments and firms’ strategies tightly connected, possibly assuming a systemic vision of the firm open to employees and in some cases to other stakeholders. The main features of European Corporate Universities will thus be acknowledged by looking at their main characteristics, with particular reference to their relation with HR departments and to the external factors that have contributed to their development. The paper uses theoretical tools provided by economic literature on training, human capital and knowledge management, combining them with a descriptive analysis of the empirical evidence coming from data on both Corporate Universities and firms’ personnel policy at European level. In particular data on firms’ personnel policy will come from the survey performed in 2005 by Cranet, the largest academic research network dedicated to a comparative analysis of developments in Human Resource Management in public and private organisations. Such data will be integrated by surveys on firms’ training practices at European level and by the (limited) empirical literature dealing with European Corporate Universities.
    Date: 2011–09
  14. By: Alberto Marzucchi
    Abstract: The present paper aims to analyse the innovation policies implemented in Italy and Spain. It adopts a multi-level perspective to investigate the effects induced by regional and national public supports and a multi-dimensional approach to disentangle the different types of additionality impacts on firms’ innovation process. In particular input, output and behavioural additionality are considered. The results, obtained through a propensity score matching estimation of the average treatment effect on treated (ATT) implemented on CIS 4 microdata, capture a complex picture. In both the countries only national policies increase R&D investment. As for output additionality, whereas Spanish regional and national policies enhance the economic exploitation of new products and patent applications, Italian interventions boost only process innovation. As for the behavioural additionality, mixed evidences emerge for regional Italian policies, for which some negative effects are also found, Italian national interventions positively affect interactions with other firms and research partners, Spanish policies (both national and regional) induce funded firms to engage in formal training and to interact more with business and research partners. A tentative analysis of the “risk of policy failure†is also provided. Apart from Italian regional policies, for which no significant result is found, the Spearman’s rank correlation coefficients reveal that the (rank of the) ATT calculated for each additionality measure is negatively related to the (rank of the) corresponding coefficient of variation. High TTs are thus correlated with low dispersions.
    Keywords: innovation policy, R&D subsidies, additionality
    JEL: O31 O38
    Date: 2011
  15. By: Hylke Vandenbussche; Christian Viegelahn;
    Abstract: This paper evaluates the Eurpean Union's antidumping (AD) policy from 1995-2009 with a special focus on the 2008-9 crisis. Combining product-level data on AD cases with detailed import data, we fail to find clear signs of a major trade policy change since the outbreak of the crisis. Our findings suggest that the EU largely remained on its pre-crisis path of AD policy with an increasing share of products and more industries covered by AD measures. Moreover, EU AD policy has increasingly focused on China and other lower middle income countries as targets. Further findings suggest that the EU is more likely to impose protection against countries and country-industries that are similar in their product mix. Country-product combinations subject to a preferential tariff are also more likely to be targeted. In terms of product characteristics, we observe that especially the shares of consumer goods and differentiated goods covered by EU AD measures have increased rapidly, remaining at a relatively high level also during the crisis.The patterns we reveal do not appear to be driven by a few outlying countries but are also similar when considering imports of individual EU member states.
    Keywords: Antidumping, crisis, European Union, great recession, product-level data, temporary trade barriers, trade policy, WTO
    JEL: F13 F14 F52
    Date: 2011
  16. By: Giunio Luzzatto (University of Genoa); Stefania Mangano (University of Genoa); Roberto Moscati (University of Milan-Bicocca)
    Abstract: Traditionally, Italy had just one long-cycle university degree; the two-tier system has been introduced as implementation of the Bologna Process (1999). We are interested in examining how the new first level degree, Bachelor in Europe and "Laurea L” in Italy, has worked in our country, mainly as far as employability is concerned. Our analysis has been framed in the European context, particularly looking at Bachelors in countries where traditionally there was only one level. The basic question is: has the new first-cycle degree been accepted by the labour market, or is it considered merely as an intermediate step in a route leading to a Master degree? As expected, there are differences in the countries under scrutiny, but there are also common indications. Answers for Italy are found analysing in detail existing surveys, which give precise indications about working and study conditions of 2007 and 2008 graduates, interviewed one year after graduation. Employment rate is not negligible, even if it is of course lower for L than from second level graduates; sometimes, work is combined with prosecution of studies. Effects of the crisis are present for both types of graduates. Some preliminary conclusions are drawn, and possible developments of the research are indicated.
    Date: 2011–09
  17. By: Bilotkach, Volodymyr; Clougherty, Joseph A.; Mueller, Juergen; Zhang, Anming
    Abstract: This paper examines the determinants of airport aeronautical charges by employing a unique panel dataset covering sixty-one European airports over an eighteen-year period. We are able to extend the literature on the role of airports as an essential element in transport infrastructure by offering the first analysis of the impact of different regulatory policies and privatization on airport charges in a panel data setting where fixed effects can be employed to mitigate endogeneity concerns. Our main empirical results indicate that aeronautical charges are lower at airports when single-till regulation is employed, when airports are privatized, and -- tentatively -- when ex-post price regulation is applied. Furthermore, hub airports generally set higher aeronautical charges, and it appears that price-cap regulation and the presence of nearby airports do not affect aeronautical charges.
    Keywords: airport charges; airports; hubs; privatization; regulation; single-till
    JEL: L33 L93 R40 R48
    Date: 2011–10
  18. By: Magali Ballatore (Catholic University of Louvain (BE))
    Abstract: Behind the image of a globalised, mobile elite there is a wide range of social realities. In Europe today, there are many types of international migrants. This paper focuses on the field of qualified, professional migration, a type that falls between the two extremities on the social spectrum: the elite corporation, top executives in the world of globalisation, and poor migrants or asylum-seekers, with little capital. Our starting point is the theory that today in Europe, certain young people from the "middle class” of the south of the continent and/or massified higher education establishments use geographical mobility as a means to social mobility (move out in order to move up). We also hypothesise that this often has consequences on both their lives and their original geographical region. We have chosen to show the "human side” (Smith; Favell, 2006) of globalisation, instead of the more common viewpoint of theory and rhetoric, by asking former Erasmus students about their careers and experiences, both professional and non-professional. We analyse to what extent their careers correspond to new injunctions and how these non-linear, reversible paths have an impact on the entry into adult life for young people from average social and professional categories. On the basis of an in-depth content analysis of around fifty semi-directive interviews with young Italian, French and English people, we show how student mobility corresponds to expectations of the economic and social world, which go beyond the expectations of the participants themselves. The question of a possible reinforcement of existing social and economic inequalities within the European Union is thus raised through the relative "freedom” of the students when confronted with exchanges.
    Date: 2011–10
  19. By: Neus Herranz; Javier Ruiz-Castillo
    Abstract: This paper investigates the citation impact of three large geographical areas –the U.S., the European Union (EU), and the rest of the world (RW)– at different aggregation levels. The difficulty is that 42% of the 3.6 million articles in our Thomson Scientific dataset are assigned to several sub-fields among a set of 219 Web of Science categories. We follow a multiplicative approach in which every article is wholly counted as many times as it appears at each aggregation level. We compute the crown indicator and the Mean Normalized Citation Score (MNCS) using for the first time sub-field normalization procedures for the multiplicative case. We also compute a third indicator that does not correct for differences in citation practices across sub-fields. It is found that: (1) No geographical area is systematically favored (or penalized) by any of the two normalized indicators. (2) According to the MNCS, only in six out of 80 disciplines –but in none of 20 fields– is the EU ahead of the U.S. In contrast, the normalized US/EU gap is greater than 20% in 44 disciplines, 13 fields, and for all sciences as a whole. The dominance of the EU over the RW is even greater. (3) The U.S. appears to devote relatively more –and the RW less– effort to sub-fields with a high mean citation rate, which explains why the US/EU and EU/RW gaps for all sciences as a whole increase by 4.5 and 5.6 percentage points in the un-normalized case.
    Date: 2011–10
  20. By: Brunilda Zenelaga (University Aleksandër Moisiu); Kseanela Sotirofski (University Aleksandër Moisiu)
    Abstract: Migration of high skilled workers, known as brain drain, is a relatively spread phenomena in both developed and developing countries. The brain drain phenomenon of the countries of the South-East Europe is determined to a large extent by common "push factors’ such as troubled economies, political instability, severe unemployment, and lack of respect of human rights, including the right to work. All these are especially true for post-communist societies, which are faced with the challenge of including the educated elite in the transition reforms that must take place to intensify bonds with the European Union. Brain gain consists of those "pull factors”, policies and strategies which create the conditions for encouraging the return of qualified nationals. From a point of view of duration, degree and impact on the development of the country, Albania constitutes the most striking example of brain drain in South East Europe. Indeed, Albania has one of the highest emigration rates in the world: during the 1990s almost 40% of lecturers and researchers left the country. Among these, 66% hold a PHD title. There are many examples of experts and students who study in Italy, and it is estimated that only 5% of them will return. Several reasons may explain the massive migration of high skilled workers from Albania, but this study is limited with those who went to Italy for study reasons. The main aim of the study is to carry out the main issues related to the reasons why the Albanians study in Italy and the ways they can be motivated to turn back and contribute to Albanian socio-economic development. A brief summary of related literature review, some qualitative data collected from semi-structured in-depth interview with 37 Master and Ph.D. students studying in Italy will be analyzed. The interviewed persons had emigrated for a better education. Among all traditional factors that determine the possible brain gain to Albania the authors find that the factors like socio-economic state, higher education system, government politics related to the orientation of returned students studying abroad, the teaching of democratic and transparency feelings and thoughts, the promoting of European rights and values, freedom, solidarity and security and the notification of European universities as an actor on the global stage are statistically important. Also some statistical data from CESS (Center for Economic and Social Studies) and Institute of Statistics related to Brain Gain process in the country will also be analyzed. This paper also attempts to assess the future trends of Albanians` move to Italy for study reasons and the turning scale to the country after their studies.
    Keywords: brain gain, brain drain, migration, transition
    Date: 2011–10

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