Brain Drain

From Wikipedia:

Human capital flight (also known as brain drain) refers to the departure or emigration of individuals with technical skills or knowledge from organizations, industries, and geographical regions.

Brain drain is a serious influence in our world and it’s only something that I’ve recently become aware of having recently lived outside of a major center of intellectual capital. I currently live in Winston-Salem, North Carolina, which is home to Reynolds Tobacco, Hanes Brands, and Krispy Kreme. Not exactly the most innovative businesses but also not bad businesses. They support an enormous workforce in this area, contribute to the local community, and are richly ingrained in the American heritage. There’s something to be said for these institutions, but they simply do not attract talent in a way that top banks, consultancies, healthcare companies, and tech firms routinely do. The result is that top students at Wake Forest and other nearby schools end up immediately leaving the place that provided them such a strong education.

This emigration of intellectual and technical capital is “brain drain”. It occurs on a much larger scale, where currently top African and Asian students leave their home country to study and work in the USA. And it also occurs within centers of intellectual capital, such as the recent trend of Google engineers leaving to join other companies or build their own startups in Silicon Valley.

A prerequisite for a world class – anything – is the ability to foster and retain talent. Current examples of countries include the USA, England, Germany. Cities such as New York, London, Tokyo. And companies such as Tesla, Apple, Intel. When an entity can’t adequately support its top people, the best people leave in large numbers, and brain drain is the result.

The brain drain phenomenon is commonly seen in the world of professional sports, such as the Miami Heat attracting many of basketball’s star players. Another strong example of brain drain is depicted in the documentary “The Two Escobars“. In short, the king pin drug dealer Pablor Escobar used the massive profits from his drug empire to attract and retain native Colombian soccer players in the local professional league. Once the drug empire eroded, so did the big pay checks for the best Colombian players, and they eventually signed back on with European clubs.

As clearly shown by professional sports, the places that attract the best people, “brain magnets”, tend to offer the best economic incentives. The generalization that Wikipedia uses is the following:

Alpha++ cities are London and New York City, which are vastly more integrated with the global economy than all other cities.

Other cities complement these two economic hubs, most often serving large niches of the economy or acting as a link between economic regions. Here’s more info on what it means to be a “Global City” and how each major city around the world stacks up: http://en.wikipedia.org/wiki/Global_city 

Looking forward, I hope to spend a significant period of time in the next few years living, learning and growing in one of these global cities.

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John Marbach

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08 2014