Kaufman Foundation: Plug the U.S. Brain Drain

May 22nd, 2011
in econ_news

global opportunity   Econintersect  by Sanjeev Kulkarni: In a recent Econintersect article The US Empire – A State of the Nation ReportElliott R. Morss pointed out that, rather than tighten up on the 10 million illegal immigrants, US has tightened up on legal immigrants rules so much that "universities like Harvard and MIT are having difficulties getting permits for their brightest foreign students to stay and work in the US."

The tightening of visa rules and availability of money globally, as he subsequently pointed out in a follow up article, has another effect:  the weakening of the entrepreneurial activism which fueled the Silicon Valley growth.

Follow up:

Economic Times in "Why entrepreneurs are dumping US",  says that, thousands of bright entrepreneurs are deserting the US and heading back home - be it India or China, citing a report prepared jointly the Kauffman Foundation, Duke University , University of California-Berkeley and Harvard University.  From that article:

"The chief motivating factor for over 60% of Indians and 90% of Chinese respondents were the exploding economic opportunities in their home countries". Researchers estimate the number might be well over 150,000.

"It's hard to put a date on when this reverse brain drain began, but it accelerated when we went into recession because these emerging economies were not really impacted," says Robert Litan, VP - research and policy at the Kauffman Foundation.

"It's not a brain drain, but a hemorrhage," exclaims Vivek Wadhwa, an entrepreneur-turned-academic, who co-authored the report.  Wadhwa continued, "Flawed US immigration policies along with opportunities in India  and China have hastened this trend." 


In series of essays published by The Kauffman Foundation, entitled "Rules for Growth," a few of top rules cited on their web site are:


  • Reforming U.S. immigration laws so that more high-skilled immigrants can launch businesses in the United States.
  • Improving university technology licensing practices so university-generated innovation is more quickly and efficiently commercialized.
  • Moving away from taxes on income that penalize risk-taking, innovation, and employment while shifting toward a more consumption-based tax system that encourages saving that funds investment.
  • In addition, the research tax credit should be redesigned and made permanent.
Sources:  Economic Times, GEI Analysis and Kauffman Foundation ("Rules For Growth":  Full Report)
Sanjeev Kulkarni is an entrepreneur based in Pune, India. He worked for large organizations in board level position before venturing on his own. He is currently involved as an investor in health care software company and as an investor, mentor in an automation company. Very widely traveled, he has experience of working in different geographical areas with people of varying nationalities. He did his BS from Indian Institute of Technology, Delhi

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