dependents in Mexico has a statistically significant and positive effect on the decision to remit or not.

The second benefit of a temporary migration scheme is that it provides greater scope for learning related benefits. That is, migration serves to enhance the skills, knowhow, etc. of the migrant and temporary migration ensures that these enhancements are transferred to the source country.<sup>5</sup> The fact that migrants acquire crucial knowledge and expertise while abroad is confirmed in a number of studies dealing with immigrant assimilation. However this literature implicitly assumes that such expertise is “host country specific” and there is no evidence on its portability (or lack of it) to the source country. Papers which focus directly on return migrants do help to shed light on this point. For example, Barrett and O’Connell (2000) study the performance of return migrants in Ireland and conclude that the returning Irish males earn about 10-15 % more than those who never migrated. They control for a number of observables and (ability based) selection biases so that the observed earnings differential is primarily due to greater accumulation of human capital abroad. Taylor (1976) and Thomas-Hope (1999) report that Jamaican migrants return home with enhanced skills, experience and perhaps most importantly leadership qualities. There is a small but growing literature which shows that employment choices of return migrants are significantly different from that of the non-migrants in the source country. In particular, returnees have a higher probability of being self-employed and that this phenomenon partly reflects superior skills and knowhow acquired abroad. For example, McCormick and Wahba (2001) study the employment experience of returnees to Egypt. Controlling for a host of factors including education level, they find that the return migrants had a much higher probability of being self-employed and they attribute this phenomenon to savings and skills acquired by the migrants while abroad. A recent survey by the IOM of return migrants to Ghana and Ivory Coast also reports that many return migrants were keen to start their own business ventures as opposed to working for others so as to implement new ideas, managerial and technical know-how they had acquired abroad.

There are also a number of studies which show that on their return migrants bring back valuable “social capital”. In one of the earlier studies, Saloutos (1956) argued that return migrants to Greece brought back new ideas on democracy, social behavior, liberal business practices, etc. Subsequent studies confirmed significant differences between natives and return migrants in Greece with respect to such ideas (Bernard and Comitas, 1978).The importance of leadership and social capital should not be under emphasized as it is crucial in the transfer of financial and human capital from the rich to poor countries through return migration (Faist, 1997). Existing evidence tends to support this view. For example, the IOM survey in Ghana and Ivory Coast referred to above documents a number of returnees claiming to benefit from social capital, etc., acquired abroad. A 40 year old Ghanaian who after returning from the U.S. launched a now-well established consulting firm stated that: “People have come back with different experiences and in

> 5 Temporariness of the skilled is not always a costless process and may even be undesirable (for global welfare) in some cases where (re)training cost is high, learning periods are long or the cumulative learning from continued stay in the host country may be very large. However, for many lower skilled, semi-skilled and some highly skilled professions, transfer of knowledge through temporary migration is likely to be an important benefit.

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