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Working Paper
The Fatal Consequences of Brain Drain
We examine the welfare consequences of reallocating high-skilled labor across national borders. A labor demand shock in Norway—driven by a surge in oil prices—substantially increased physician wages and sharply raised the incentive for Swedish doctors to commute across the border. Leveraging linked administrative data across the two countries and a difference-in-differences design, we show that this shift doubled commuting rates and significantly reduced Sweden’s domestic physician supply. The result was a persistent rise in mortality in Sweden, with no corresponding health gains in ...