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When skilled labor is imported, skill levels of local workers may be raised by contact with new techniques and practices. European basketball offers an opportunity to test this general claim. For a panel of 47 countries observed over more than twenty years, the authors model probability of qualification for, and performance in, international tournaments. They demonstrate that an increase in the number of foreigners in a domestic league tends to generate an improvement in the performance of the national team (which comprises only local players). Given this, they develop a theoretical framework for how a regulator might take this into account.
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