Conference on High-Skill Immigration

October 25, 2012
Sarah Turner, NBER and the University of Virginia, and William Kerr, NBER and Harvard Business School, Organizers

Jennifer Hunt, Rutgers University and NBER

Does the United States Admit the Best and Brightest Computer and Engineering Workers?

Using the American Community Surveys of 2009 and 2010, Hunt examines the wages of immigrant-versus-native computer and engineering workers. In those occupations, immigrants have higher weekly wages than natives: by 15.7 percent for computer workers and 6.8 percent for engineering workers. In samples of workers with computer and engineering bachelor's degrees, immigrants are less successful: immigrants with computer bachelor's degrees earn 2.5 percent more than their native counterparts, but immigrants with engineering bachelor's degrees earn 10.3 percent less than their native counterparts. The immigrants are less successful in education-based samples because the return to English is higher their: successful degree holders are promoted from technical occupations to management, which requires good English. The government could increase immigrant lifetime earnings by following the Australian example of a pre-immigration English test.

Jeffrey Grogger, University of Chicago and NBER, and Gordon Hanson, University of California at San Diego and NBER

Attracting Talent: Location Choices of Foreign-Born PhDs in the US

Grogger and Hanson use data from the National Science Foundation to examine the post-degree location choices of foreign-born students receiving PhDs from U.S. universities in science and engineering. Individuals with advanced training in science and engineering are important inputs in the process of innovation. They are more likely than other college graduates or post-graduates to produce and to commercialize patents. Where they choose to live and work affects the global distribution of innovation capacity. In low-income countries, there are few opportunities to obtain advanced training in science and engineering, requiring students to pursue degrees abroad with many going to the United States. The success of these countries in luring students who obtain graduate degrees from U.S. or other foreign universities back home determines their capacity for indigenous research and development. Over the period 1960 to 2008, 77 percent of foreign-born S&E PhDs state that they plan to stay in the United States. The foreign students more likely to stay in the United States have stronger U.S. ties, as measured by having a permanent residence visa or having attended a U.S. college, or stronger academic ability as measured in terms of parental educational attainment, the student's success in obtaining graduate fellowships or scholarships, and the rank of the student's university and academic department. Foreign students staying in the United States thus appear to be positively selected in terms of academic ability. Foreign students also are more likely to stay in the United States if in recent years the U.S. economy has had strong GDP growth, or if the birth country of the foreign student has had weak GDP growth. Foreign students are less likely to remain in the United States if they are from countries with higher average income levels. As a country develops, its students obtaining degrees abroad become less likely to stay in the United States and more likely to return home. Education and innovation therefore may be part of a virtuous cycle in which education enhances prospects for innovation in low-income countries and innovation makes residing in these countries more attractive for scientists and engineers.

Paula Stephan, Georgia State University and NBER; Chiara Franzoni, Politecnico di Milano; and Giuseppe Scellato, Politecnico di Torino

The Comings of the Foreign-born for PhD and Postdoctoral Study: A Sixteen Country Perspective

Stephan, Franzoni, and Scellato analyze the decisions of foreign-born PhD and postdoctoral trainees in four fields of science to either come to the United States or another country for their study. The data come from the GlobSci survey of active research scientists residing in 16 countries, conducted in 2011. The researchers find that the United States is the most common destination country. Individuals come here to study because of the prestige of the program and/or career prospects. For recent trainees, the availability of financial assistance also plays an important role. When they expand the data to a longer time span, they find that the relative attractiveness of the United States for the Ph.D. declines for those who received their degree after 2000; for postdoctoral training, it has declined since 1990. The factors that discourage the foreign born from getting a Ph.D. in the United States versus another country are 1) the perceived U.S. life style and 2) the availability of fewer exchange programs, compared to those in other countries, especially in the EU. The relative attractiveness of fringe benefits discourages the foreign born from taking a postdoc position in the United States. The countries that have been nibbling at the U.S. share include Australia, Germany, Great Britain, Japan, and Switzerland. France has gained appeal in attracting postdocs, but not in attracting PhD students. Canada has not made gains in either.

Sari Kerr, Wellesley College; William Kerr; and William Lincoln, Johns Hopkins University

Skilled Immigration and the Employment Structures and Innovation Rates of U.S. Firms

Kerr, Kerr, and Lincoln study the impact of skilled immigrants on the employment structures and innovation outcomes of U.S.firms using matched employer-employee data. They use the firm as the lens of analysis, given that many skilled immigrant admissions are driven by firms subject to regulations and mandated caps (for example, H-1B visa). OLS and IV specifications find rising overall employment with increased skilled immigrant employment by the firm; employment expansion is greater for younger natives than older natives. Departure rates for older workers appear higher for workers in STEM occupations. Skilled immigration expands firm innovation with little impact on the traits of patents filed.

Ina Ganguli, Stockholm School of Economics

Immigration & Ideas: What Did Russian Scientists `Bring' to the US?

How have immigrant scientists contributed to the diffusion of knowledge in the United States? Ganguli draws upon the end of the Soviet Union to study the link between immigration and the flow of scientific ideas. During Soviet times, the USSR was relatively "closed" to contact with researchers outside of the Eastern bloc. When the Soviet Union collapsed, there were new opportunities for Russian and U.S. scientists to communicate and for Russian scientists to emigrate. This "opening" and flow westward of Russian scientists and knowledge produced in the USSR allow her to examine the extent to which immigrants brought new ideas to the United States. Following recent papers on localized knowledge diffusion that have examined individual inventor and scientist mobility within the United States and citation patterns by using rich panel datasets, Ganguli uses a difference-in-difference approach to estimate the causal impact of migration on knowledge flows. She creates a paper-pair-level dataset of papers published during the Soviet period by later migrants (treated papers) and non-migrants (controls) using matching techniques and finds that after a Russian scientist moved to the United States, citations to his or her papers published during Soviet times increased relative to similar control papers authored by non-migrants. Differences by field suggest that migrants in the Life Sciences and Chemistry contributed more to the diffusion of ideas in the United States than migrants in Physics and Mathematics.

George Borjas, Harvard University and NBER, and Kirk Doran, University of Notre Dame

Intellectual Mobility: Native Responses to Supply Shocks in the Space of Ideas

Borjas and Doran argue that in response to supply shocks. workers not only move from one job to another or from one geographic location to another, but also move in the more intangible space of ideas. Knowledge producers who are conducting research on a particular set of questions may respond to supply and demand shocks by shifting their resources to a different set of questions. Intellectual mobility thus measures the transition from one location in idea space to another location in that space. These researchers examine the intellectual mobility flows unleashed by the influx of a large number of Soviet mathematicians into the United States after the collapse of the Soviet Union. They exploit the fact that the influx of Soviet mathematicians into the American mathematics community was larger in some fields than in others. Constructing several new empirical measures of intellectual mobility, they find substantial intellectual mobility in response to the influx, with American mathematicians moving away from, rather than moving to, fields that likely received large numbers of Soviet émigrés. It appears that diminishing returns in specific research areas, rather than beneficial human capital spillovers, dominated the intellectual mobility decisions of pre-existing knowledge producers. This analysis also begins to shed light on the black box of the intellectual mobility decision by delineating some of its determinants. The authors consistently observe that high-quality mathematicians were less likely to move to a different location in the space of ideas in response to the Soviet supply shock. Interpreting this finding through the lens of a Roy‐type framework of intellectual mobility, the evidence suggests that high quality mathematicians either have higher mobility costs or gain larger positive spillovers from interacting with other knowledge producers.

Richard Freeman, Harvard University and NBER, and Wei Huang, Harvard University

Collaborating With People Like Me: Ethnic Co-authorship within the US

The globalization of science has changed the ethnic and national origin of scientists and engineers in the United States. The influx of international students has raised the share of the foreign-born among science and engineering new PhDs. Over half of post-doctorate workers in science labs come from overseas. Expansion of higher education worldwide has increased the supply of non-U.S. educated scientific researchers, which contributes to the flow of immigrant scientists and engineers to the United States. Political shocks, such as the collapse of the Soviet Union, have led to sudden influxes of scientists and engineers to the U.S. job market. Freeman and Huang examine the pattern of ethnic collaborations among U.S.-based researchers and the relation between ethnic collaborations and the impact factor of the journals in which collaborators publish their papers. They measure ethnicity by the names of coauthors on scientific papers. Their analysis of names shows a huge increase in the share of U.S.-based scientific authors from developing economies, particularly China, and a corresponding decrease in the share with traditional English names. They find that researchers are more likely to work with people of the same ethnicity than would arise by chance – homophily in co-authorships.

John Bound, University of Michigan and NBER, and Breno Braga and Joseph Golden, University of Michigan

Recruitment of Foreigners in the Market for Computer Scientists in the US

The H-1B visa program remains controversial. Advocates, including leaders in the IT industry, have argued for the need to relax current quotas, claiming that there are simply not enough skilled workers in the United States to satisfy demand. Others have argued that the H-1B visas program benefits IT employers at the expense of the wages and employment prospects of IT workers. Bound, Braga, and Golden explore the impact that the H-1B program had on the labor market for computer scientists in the United States during the Internet boom of the 1990s, a period of dramatic growth in the number of foreign-born computer scientists working in the United States on H-1B visas. To assess the impact of the dramatic expansion of the number of foreign-born computer scientists working in the United States during the 1990s, the researchers follow two strategies. They first compare employment and wage outcomes during the IT boom, associated with the introduction of the PC in the late 1970s, to the more recent one. As an alternative, they build a dynamic model of the labor market for computer scientists, benchmarking the model with available U.S. data. Theyfind a greater wage and smaller total employment response during the earlier boom, consistent with the notion that the availability of foreign high skilled workers has increased the overall labor supply elasticity of skilled workers to the U.S. IT sector. Using their model to evaluate counterfactuals, they simulate that had U.S. firms not been able to increase their employment of foreign computer scientists over their 1994 levels, they would have succeeded in replacing about half of the shortfall with U.S. residents and the earnings of computer scientists would have increased by about 50 percent more than they actually did.

Michael Clemens, Center for Global Development

The Effect of International Migration on Productivity: Evidence from Randomized Allocation of U.S. Visas to Software Workers at an Indian Firm

Why do Indian software workers employed by U.S. firms earn more in the United States than in India? There are several possibilities, among which is the pure effect of location on workers' economic product. Clemens seeks to isolate the location effect from other effects in a single setting via a natural experiment: a randomized allocation of temporary U.S. visas among one group of Indian software programmers. In this setting, outputs are close to perfectly tradeable, workers in the United States and India are observably and un-observably identical in expectation, effects like Baumol's cost disease and cost-of-living compensating differentials are less relevant, and some of the plausible effects of place on productivity (such as access to technology) are identical for both groups. The large majority of the earnings gap remains, suggesting that these workers are several times more economically productive solely because of working in the United States rather than in India. This effect is measured for a single firm and external validity is circumscribed. Further study of the effect of location on economic product has implications for the economic gains to migration, trade, and technology transfer.

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