Can Beijing stem the brain drain?

Executive Summary

Since 1978, when China’s government introduced major economic changes and lifted a ban on emigration, about 10 million Chinese nationals have moved abroad. More than 2 million of these emigres live in the United States. The outflow has created a brain drain, and amounts to a vote of no confidence by emigres in Chinese society. Experts say Chinese parents are sending their children at increasingly younger ages to school in the West. They also are seeking economic opportunities and societies where the rule of law guarantees that their wealth will be protected. Yet many Chinese citizens will return home because they cannot obtain permanent visas and because China’s dynamic economy still offers opportunity.

Some key takeaways:

  • The United States has wooed wealthy Chinese with investment and visa opportunities, and recent arrivals have contributed to the U.S. economy, although critics say some U.S. immigration programs invite corruption and pose security concerns.

  • China has moved to stem the outflow by instituting educational reforms, restricting foreign-currency purchases and seeking to attract emigres back home.

  • Chinese overseas nationals sent more than $16.2 billion home in 2015, the second highest total in the world after remittances from Mexican citizens.

Resources for Further Study

Bibliography

Books

Lee, Erika, “The Making of Asian America: A History,” Simon and Schuster Paperbacks, 2015. A historian of immigration traces how Asian nationals transformed the United States.

Spence, Jonathan D., “The Search for Modern China (Third Edition),” W.W. Norton and Co., 2012. A Yale University history professor outlines China’s political, economic, social and cultural past.

Zhao, Yong, “Who’s Afraid of the Big Bad Dragon: Why China has the Best (and Worst) Education System in the World,” Jossey-Bass, 2014. A leading education academic dissects China’s school system.

Zolberg, Aristide R., “A Nation by Design: Immigration Policy in the Fashioning of America,” Russell Sage Foundation, 2006. A political science professor describes America’s complex political and social relationship with new arrivals.

Articles

“The New Class War: Special Report, Chinese Society,” The Economist, July 9, 2016, http://tinyurl.com/gppn5mv. A journalist outlines how the rise of China’s first large middle class creates opportunities and challenges for the Chinese government.

Barton, Dominic, Yougang Chen and Amy Jin, “Mapping China’s Middle Class,” McKinsey Quarterly, June 2013, http://tinyurl.com/zdlet22. A business consultancy says that rising prosperity in China’s inland cities will fuel consumption.

Larmer, Brook, “The Parachute Generation,” The New York Times Magazine, Feb. 2, 2017, http://tinyurl.com/zat3uch. A magazine article explains why parents of even younger Chinese students are enrolling their offspring in U.S. schools.

Reports and Studies

Farrugia, Christine, and Rajika Bhandari, “Open Doors: Report on International Educational Exchange,” Institute of International Education, 2016, http://tinyurl.com/n2ewxf9. An annual statistical report traces international students in the United States and U.S. students abroad.

Rosen, Daniel H., and Thilo Hanemann, “New Neighbors 2017 Update: Chinese FDI in the United States by Congressional District,” Rhodium Group, April 24, 2017, http://tinyurl.com/lgnmops. An annual report by a research firm tracks overseas investing

The Next Step

China and the Global Economy

Macfarlane, Alec, “China has a grand plan to dominate world trade,” CNN Money, May 12, 2017, https://tinyurl.com/n73kprm. As President Trump resists globalism, China looks to increase its international influence with its One Belt, One Road initiative, which would pump billions of dollars into railways, roads and other projects across Africa, Asia and Europe.

Magnier, Mark, “China’s economy slows in April in ‘turning point,’” Market Watch, May 15, 2017, http://tinyurl.com/l66wlct. Chinese industrial production, retail sales and fixed-asset investment slowed in April, missing estimates, but most economists believe the country can meet this year’s growth target.

Sang-Hun, Choe, “Moon Jae-in of South Korea and China Move to Soothe Tensions,” The New York Times, May 11, 2017, http://tinyurl.com/lhxffde. Chinese and South Korean leaders looked to mend ties after South Korea allowed the United States to build on its territory a missile defense system, which China views as a threat to its security.

U.S. Immigration Policy

Barros, Aline, “H1B Visa Applications Down Amid Reform Effort,” Voice of America, April 19, 2017, https://tinyurl.com/kyybgr3. Applications for H1B visas – which allow U.S. companies, typically tech firms, to temporarily hire skilled foreign workers – decreased this year amid criticism that the program takes jobs and earning power away from American workers.

Geewax, Marilyn, and Jackie Northam, “Kushner Family Business Pitch In China Prompts Questions About Investor Visas,” NPR, May 8, 2017, http://tinyurl.com/lcjx263. Ethicists objected after Nicole Meyer, the sister of President Trump’s son-in-law and adviser, Jared Kushner, told Chinese investors they could qualify for EB-5 visas by investing at least $500,000 in a New Jersey real estate project backed by her family. Critics say the visas – which offer a route to permanent U.S. residence with an investment that creates at least 10 full-time jobs for U.S. workers – are magnets for fraud and abuse.

Merchant, Nomaan, “AP Exclusive: Chinese Spent $24b On US, Other ‘Golden Visas,’” Associated Press, May 16, 2017, http://tinyurl.com/m56xnof. The United States has issued more than 40,000 “golden visas,” part of the EB-5 visa program, to Chinese migrants and investors, who have paid at least $7.7 billion to the United States and about $24 billion for these types of visas across the world, according to an Associated Press analysis.

Organizations

Asia Society
725 Park Ave., New York, NY 10021
1-212-288-6400
http://asiasociety.org
info@asiasociety.org
Cultural and educational organization offering lectures and classes on Asian arts, business, culture and policies. Also operates in Shanghai and Hong Kong.

The Brookings Institution
1775 Massachusetts Ave., N.W., Washington, DC 20036
1-202-797-6000
https://www.brookings.edu
A nonprofit public policy research organization with a sister center in Beijing.

Council on Foreign Relations
The Harold Pratt House, 58 East 68th St., New York, NY 10065
1-212-434-9400
http://www.cfr.org
A nonpartisan membership organization that conducts research, sponsors discussions and publishes the journal Foreign Affairs.

Institute of International Education
809 United Nations Plaza, New York, NY 10017
1-212-883-8200
https://www.iie.org
A nonprofit that provides scholarships and research on student enrollment worldwide, including in its annual Open Doors report.

Migration Policy Institute
1400 16th St., N.W., Suite 300, Washington, DC 20036
1-202-266-1940
http://www.migrationpolicy.org/
A nonpartisan, nonprofit think tank that analyzes the movement of people worldwide.

RAND Corporation
1776 Main St., Santa Monica, CA 90401
1-310-393-0411
http://www.rand.org
A nonprofit think tank that conducts research and analysis.

DOI: 10.1177/237455680315.n3