I combine patent, decennial census and other data to measure the extent to which skilled immigration increased innovation in the United States from 1950-2000. I instrument 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, and consider changes of between ten and 50 years. I find that a one percentage point rise in the share of immigrant college graduates in the population increases patenting by 8-15%; the equivalent range for immigrants with post-college education is 15-33%. A one percentage point rise in the share of immigrant scientists and engineers in the workforce increases patenting by at least 41%. The effects are similar in the short and long run, and appear to be much larger than the effect of skilled natives, especially in the short run. This may be related to my finding that natives are crowded out by immigrants in the short run, but not in the long run. My analysis shows the importance of convergence among states for the evolution of patents. [emphasis added.]There are plenty of studies that attempt to estimate the costs of immigration, and fewer that measure the benefits, but this paper fits into a unique niche because few authors have investigated this specific link, at least as far as I know. If you take these results seriously and apply them in a policy context, I think it clear that the paper supports Richard Florida's idea that the world is in a global competition for talent, and that while the US has been successful at attracting talent in the past, we are not well suited to compete in the future. Any thoughts from our immigration experts?
Friday, May 2, 2008
Immigration and Innovation
What is the impact of skilled immigration on innovation? A new paper by Jennifer Hunt, prepared for an NBER conference on labor studies attempts an answer. From the abstract (HT):