Sunday 04 Jun 2023
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This article first appeared in Forum, The Edge Malaysia Weekly on January 8, 2018 - January 14, 2018

Consider this: For the past five years, you have spent every Saturday morning volunteering at a local soup kitchen. You do this for many reasons — your parents taught you the importance of kindness and empathy, you believe in helping marginalised individuals and you are grateful that you have so much and want to give back. So, you come in every Saturday, rain or shine, even when it is very inconvenient for you to do so, even when the opportunity cost of coming is very high.

One day, your supervisor at the soup kitchen tells you that instead of volunteering, you will be hired as a worker to come in every Saturday, with an hourly rate and a punch card for when you sign in and out.

“I can’t pay much but I will pay you RM5 per hour,” she says. How would you feel?

I’d be willing to bet that you and your fellow volunteers would feel very uncomfortable. In fact, academic research has shown that most of you would end up putting less effort into your voluntary work than you would have had there been no payment.

Some of you might even quit. The reason is that monetising the relationship has caused you to think about the act of volunteering differently. Getting paid for your voluntary work has cheapened the value of the relationship to you. The payment, which was supposed to serve as an incentive, has taken the meaning out of your work.

Something similar may be at play in Malaysia with regard to its brain drain. As countries around the world become richer and as barriers between them fall, talent becomes more global. This makes it very hard for developing nations like Malaysia to compete with richer countries that can offer higher wages.

We often send our top students, who are internationally competitive, abroad to further their studies. Many of these students are funded by local sponsors who pay for all of their expenses in exchange for a couple of years of service — that is loan repayment through working. However, many students get around this requirement by simply paying off their loans over time while working abroad.

While scholarship bonding has been the main policy tool used to bring back Malaysian talent, we know that it doesn’t always work. The disincentives that I highlighted in the voluntary work example may be one of the reasons why. Instead of appealing to one’s sense of patriotism or urge to return, to do good things and create change, it places a price on coming home. Taking this price into consideration sours the decision-making process — it disempowers a graduate from feeling like his decision to return is independent and made out of his own free will.

There is a lot of research on the disadvantages of commoditisation in the markets — how individuals may be less likely to donate organs if they knew, for example, that they would be paid exactly US$10,000 for a kidney. Why? Well, many people perform selfless acts like donating kidneys or volunteering because of the “warm glow” effect — the feeling of satisfaction and happiness gained from helping another person. Bringing money into this relationship makes the donation seem less sincere and more like a paid service. In general, people seem to value altruism more than the amount they would be paid for the act.

In short, bonding alone does not completely solve our brain drain. Now, let me tell you about a set of incentives that could work that do not cost a single sen. The key is to understand that Malaysia is a status-conscious society and that prestige matters. So, what are some easy ways to elevate a returning graduate’s prestige?

A special title, for example, could be granted to returning graduates to be used in formal settings. This could be something like the Ir (ingenieur) title for engineers — perhaps something like Sch (for scholar).

Many American states put tiny hearts next to the names of donors on their driving licences — a small but obvious mark of acknowledgment. Perhaps, returning graduates could have a similar mark on their identification cards, something that seems insignificant but differentiates a returning scholar’s IC from everybody else’s. There could also be special licence plates or stickers that could be displayed on one’s car.

True, these incentives seem superficial but once you consider that Malaysia cannot compete with richer countries on wages, they make sense. Enhanced social prestige is something that fresh Malaysian graduates cannot expect to get from other countries. This would make the option of coming home and becoming a “somebody” in Malaysia more attractive than staying abroad and being a “nobody”.

Ideally, Malaysian talent should feel compelled to return home not because they have no other option but because they want to. If Malaysia rewards this choice to come home in a unique way, we would be more competitive against richer countries that benefit from our brain drain.

Dr Melati Nungsari is Assistant Professor of Economics at the Asia School of Business and research affiliate at the Massachusetts Institute of Technology’s Sloan School of Management. The views and opinions expressed here are her own and do not necessarily reflect those of the Asia School of Business, Bank Negara Malaysia or MIT Sloan.

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