International Graduates' Stay Rate, Country‐Level Economic Differences and Social Networks: Evidence From 25 European Countries

ABSTRACT This paper investigates the relationship between the stay rate of international university graduates, economic characteristics of their origin and destination countries, and proxies of their social networks. It contributes to the literature by jointly testing predictions of the neoclassical and migration network theories using regression analysis, employing a unique dataset of 1655 observations that provides macro‐level information about stay rates of non‐EU graduates from 94 origin countries in 25 European destination countries in 2017. The findings show that stay rate is higher in destination countries with higher GDP growth rate and lower youth unemployment, and for graduates who come from countries with lower GDP per capita. The stay rate is also higher for graduates whose origin country constitutes a lower share of graduates in their destination country, and for graduates from the US, Canada and Australia. Together, measures suggested by both theories explain over 50% of stay rate.