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Trump’s Brain Drain

Though higher-education services are a major US export and a key source of domestic innovation and economic growth, this key sector is often lost in debates about trade and the current account balance. But with foreign enrollment in US universities now declining in the age of Donald Trump, Americans should not be surprised if their own tuition bills go up.

WASHINGTON, DC – America’s high-quality universities are among the key sources of its greatness. Every year, top students from all over the world vie for access to graduate and undergraduate programs in the US, and American universities occupy most of the top spots in global rankings. Moreover, the basic research conducted at US universities has been a primary driver of innovation and economic growth, as well as the source of a disproportionate share of Nobel prizes.

America’s universities cater to a wide variety of students, researchers, and other economic actors. The top research universities attract not just the best and the brightest students, but also clusters of high-tech companies, such as those in Silicon Valley and Boston. At the same time, public and private universities across the country offer excellent programs for four-year degrees. And community colleges provide vocational training as well as a pathway to a four-year degree for countless other high-school graduates.

With competition between public and private institutions ensuring a high level of excellence across the board, higher education in the US has long been a major export industry. According to Catherine Rampell of the Washington Post, US “educational exports are about as big as [US] total exports of soybeans, coal and natural gas combined.” With three times more foreign students studying in the US than Americans studying abroad, the US higher-education sector contributed a net surplus of around $34 billion to the US current account in 2017.

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