By Siddhartha Mitra and Vivekananda Mukherjee
Every year tens of thousands of students leave India to realise their dreams in a foreign land. Most of them pursue undergraduate and postgraduate degrees in Anglo-Saxon countries such as the US, the UK, Australia, Canada and Ireland, but not all (or even a high proportion of these students) go to the top schools in these countries. Many leave the country to study at a foreign institute because their academic performance has not been good enough to get them into an Indian school of their choice, and the opportunities available to them abroad are better than the residual opportunities in the country. Others leave because admission to a university in a developed country is ostensibly a passport to a good life. In such cases, the quality of the accepting university does not matter.
The brain drain taking place from developing countries like India has often been highlighted by scholars and the media. A lot of government resources generated from the tax-paying Indian goes into the development of brains that never return and serve her. While the payment of taxes should result in benefits for the taxpayer, the brain drain violates this norm.
Accompanying the brain drain is a financial drain. Affluent Indian parents pour millions of dollars into foreign economies to pay for the education of children whose formative learning has been funded through subsidies provided by the Indian government. This creates a situation of an outflow of financial resources from India with little return since most of the departing youth settle abroad.
This is not a diatribe advocating nationalism and urging young Indians to shun foreign education even if the prospects for them at home are not satisfactory. It does not make sense to criticise individuals for being pragmatic and making optimal decisions, given the existing set of incentives. Rather, it is a plea to modify the structure of incentives so that the resident stock of human capital grows at a faster clip with beneficial implications for research, innovation, teaching and, therefore, economic growth.
Halting the brain drain
To achieve this, two measures need to be taken.
First, we need to improve the quality of our universities, especially in terms of the faculty. Clearly, there is a need for many universities to hire high quality foreign trained or foreign faculty members as the existing pool of human capital is grossly inadequate and often of poor quality. Many of the new IITs and IIMs do not have enough quality faculty and are somehow pulling through by borrowing the services of faculty members of their older and established sister institutions.
The situation in the new state and central universities is just as bad. There are many vacant faculty positions due to a lack of suitable candidates.
Second, it is necessary to structure incentives such that scholars remain motivated throughout their careers. For instance, a promotion to the rank of Full Professor should not happen as a matter of course but should depend on academic output or contributions to the larger good of the community. Annual salary revisions too should be based on recent academic activity.
One may wonder how universities will be able to afford salary revisions and hiring of foreign faculty. The answer lies in pricing education at a level in excess of average cost for those with incomes above a designated threshold; for others, either at average cost or below it through scholarships. In other words, one should move from a model of universal government subsidisation of university education to one in which the universities and colleges are self-financing with the government only performing the role of accreditation and regulation.
Perhaps as a result of these policies the country might be able to retain students with large ability to pay and/or high potential. The human capital resident in the Indian educational system will thus grow at a faster clip with favourable implications for economic growth as well as poverty alleviation.
Siddhartha Mitra and Vivekananda Mukherjee are professors in the Department of Economics, Jadavpur University.