fact most of the returnees that I’m aware of have come back to set up their own business, and I think they have been relatively more successful setting up their businesses because ... I think you have an advantage when you’re traveled and you’ve come back, you are willing to take more risk, you are willing to push what you are doing.”<sup>6</sup> These benefits of enhanced skills and knowledge need not be restricted to those who migrate only. That is, return migrants can pass on at least some of this knowledge to other Zambian doctors which is an additional gain to the source country. Of course, such transfers can occur under permanent migration also but it requires elaborate schemes such as RQAN and goodwill of the migrants.

The third reason why temporariness could be attractive for Zambia relates to its egalitarian nature. Permanent migration involves only 300 doctors earning higher wages abroad and permanently so. In contrast, under temporary migration, such benefits would be distributed over a much larger section of the population. From an individual migrants’ point of view, permanent migration is high-risk and high-return as very few get a chance to work abroad but those who do earn higher wages for the rest of their life. On the hand, temporary migration is low-risk and low-return since more people get a chance to work abroad but over shorter periods. If agents are risk averse, and could choose which type of migration should be allowed in general, then temporary migration may well be the preferred choice in a political equilibrium.

Two related questions which remain to be answered relate to the host country’s incentive structure and the feasibility of implementing a temporary migration regime. We discuss these two issues below.

# **Host country incentive structure: Generosity vs. self-interest**

Evidence on host’s preference between temporary and permanent skilled migration seems to be mixed. On the one hand, there are concerns about permanent immigration and most international negotiations focus only on temporary migration. On the other hand many developed countries have created channels through the broader migration policy which allow temporary migrants to become permanent residents. The main concern of the host about permanent rather than temporary migration is that the former involves additional socio-cultural and economic costs of the type discussed for the unskilled permanent migrants above. Let _SP_ denote this cost. That is, replacing one would-be permanent migrant by a temporary one increases host country’s social welfare by _SP_ units. The main advantage of permanent migration is that it allows host country to extract some surplus from investing in the migrants’ skills. For example, in a two period game, a firm may like to invest in providing firm-specific training to a migrant in period 1 which increases his efficiency in the next period. Consequently, the firm can extract part of the surplus in the second stage. Suppose the surplus so extracted equals _E_ while the cost of training to the firm equals _c_ . Of course, values of _E_ , _c, SP_ will vary across migrants depending on various characteristics with perhaps the skill content of the migrant (profession) being most important. The following graph illustrates the point.

> 6 Reported in Ammassari (2003), page 10.

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