How Much Does Immigration Boost Innovation?

Abstract

We measure the extent to which skilled immigrants increase innovation in the United States by exploring individual patenting behavior as well as state-level determinants of patenting. The 2003 National Survey of College Graduates shows that immigrants patent at double the native rate, and that this is entirely accounted for by their disproportionately holding degrees in science and engineering. These data imply that a one percentage point rise in the share of immigrant college graduates in the population increases patents per capita by 6%. This could be an overestimate of immigration's benefit if immigrant inventors crowd out native inventors, or an underestimate if immigrants have positive spill-overs on inventors. Using a 1950-2000 state panel, we show that natives are not crowded out by immigrants, and that immigrants do have positive spill-overs, resulting in an increase in patents per capita of about 15% in response to a one percentage point increase in immigrant college graduates. We isolate the causal effect by instrumenting the change in the share of skilled immigrants in a state with the initial share of immigrant high school dropouts from Europe, China and India. In both data sets, the positive impacts of immigrant post-college graduates and scientists and engineers are larger than for immigrant college graduates.

International business travel: an engine of innovation?

“…Moreover, there is strong evidence that the impact on innovation depends on the quality of the technological knowledge carried by each business traveler. While international migration has long been a hot topic in debates on labor market policies, some recent work has started to address another set of policy questions by linking long-term immigration to innovation in an economy (Peri 2007;Hunt and Gauthier-Loiselle 2010;Stuen et al 2012). In contrast, our research informs policymakers by examining how strongly short-term cross-border movements might affect innovation.…”

The internationalization of science and its influence on academic entrepreneurship

“…Stephan and Levin (2001) analyze the productivity of researchers in science and engineering in the US and find that foreignborn and foreign-educated are disproportionately represented among the scientists making exceptional contributions in terms of high quality 'hot' papers, citations and elections to the National Academy of Engineering. Using the 2003 National Survey of College Graduates in the US, Hunt and Gauthier-Loiselle (2008) show that foreign-born hold on average higher degrees in science and engineering, and patent at double the native rate. Similarly, Wadhwa et al (2007) report a dramatic trend in the inventive activities of foreign-born in the US.…”

“…By doing so, we add an additional aspect to the literature on the potential benefits from 'brain gain' or 'brain circulation'. Previous studies rather focus on how foreign-born and foreign-educated scientists contribute to research productivity via publications (Stephan and Levin 2001) and patenting (Hunt and Gauthier-Loiselle 2008;Kerr 2008). At the same time, there is increasing evidence emphasizing the economic importance of entrepreneurial activities of scientists.…”

International Migration

“…Finally, Hunt and Gauthier-Loiselle (2010) investigate the impact of immigration on innovation and find a positive relationship between the number of patents per capita and skilled immigration at the state level. Kerr and Lincoln (2010) show evidence of a positive effect of the number of H1B visas granted on the direct contribution of ethnic innovators.…”