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Effects of Immigration on American Science and Innovation

Paper Session

Friday, Jan. 3, 2020 2:30 PM - 4:30 PM (PST)

Marriott Marquis, Grand Ballroom 12
Hosted By: American Economic Association
  • Chair: Ethan G. Lewis, Dartmouth College

From Immigrants to Americans: Race and Assimilation During the Great Migration

Vasiliki Fouka
,
Stanford University
Shom Mazumder
,
Harvard University
Marco Tabellini
,
Harvard University

Abstract

How does the appearance of a new out-group affect the economic, social, and cultural integration of previous outsiders? We study this question in the context of the first Great Migration (1915–1930), when 1.5 million African Americans moved from the U.S. South to urban centers in the North, where 30 million Europeans had arrived since 1850. We test the hypothesis that black inflows led to the establishment of a binary black-white racial classification and facilitated the incorporation of—previously racially ambiguous—European immigrants into the white majority. We exploit variation induced by the interaction between 1900 settlements of southern-born blacks in northern cities and state-level outmigration from the U.S. South after 1910. Black arrivals increased both the effort exerted by immigrants to assimilate and their eventual Americanization. These average effects mask substantial heterogeneity: while initially less integrated groups (i.e., Southern and Eastern Europeans) exerted more assimilation effort, assimilation success was larger for those that were culturally closer to native whites (i.e., Western and Northern Europeans). These patterns are consistent with a framework in which changing perceptions of out-group distance among native whites lower the barriers to the assimilation of white immigrants.

Immigration and Entrepreneurship in the United States

Pierre Azoulay
,
Massachusetts Institute of Technology
Benjamin F. Jones
,
Northwestern University
J. Daniel Kim
,
University of Pennsylvania
Javier Miranda
,
U.S. Census Bureau

Abstract

Immigration is often viewed as expanding the labor supply and creating greater competition for domestic workers. But immigrants may also play important roles in innovation, including starting new firms, that may both drive productivity growth and expand labor demand. This paper uses newly available U.S. administrative data to study the role of immigrants in entrepreneurship. We ask how often immigrants start companies, how many jobs these firms create, and how often these firms appear in high-tech sectors and achieve explosive growth. The findings suggest that immigrants are as much “job creators” as “job takers” and that non-U.S. born founders play outsized roles in U.S. high-growth entrepreneurship.

Immigrant Entrepreneurship: Job Creation, Job Quality, and Innovation

Sari Pekkala Kerr
,
Wellesley College
William Kerr
,
Harvard University

Abstract

This paper examines immigrant entrepreneurship in the Survey of Business Owners (SBO) and the Longitudinal Employer Household Dynamics (LEHD) database. We quantify the rate of firm ownership by immigrants in the United States, as well as the contribution of immigrant entrepreneurs in terms job creation. First-generation immigrants create about 25% of new firms in the United States, but this share can exceed 40% in some states. Immigrant-owned firms, on average, create fewer jobs than native-owned firms, but much of this is explained by the industry and geographic location of the firms. Immigrant-owned firms pay comparable wages, conditional on firm traits, to native-owned firms, but are less likely to offer employee benefits such as health insurance and paid time off. Moreover, the jobs generated by immigrant founders are disproportionately occupied by immigrant employees, most often hailing from the same place of birth as the founder(s). The duration of jobs in immigrant founded firms is longer, but only among immigrant employees. Finally, while firms founded by high-skilled immigrants are more likely to file for patents, the average number of granted patents remains below that of similar native-founded firms.

Immigration, Science, and Invention - Lessons from the Quotas Acts

Petra Moser
,
New York University
Shmuel San
,
New York University

Abstract

In 1921 and 1924, the United States first adopted immigration quotas for “undesirable” nationalities to stem the inflow of low-skilled Eastern and Southern Europeans (ESE). This paper investigates whether these quotas inadvertently hurt American science and invention. Detailed biographic data on the birth place, immigration, education, and employment histories of more than 80,000 American scientists reveal a dramatic decline in the arrival of ESE-born scientists after 1924. An estimated 1,170 ESE-born scientists were missing from US science by the 1950s. To examine the effects of this change on invention, we compare changes in patenting by US scientists in the pre-quota fields of ESE-born scientists with changes in other fields in which US scientists were active inventors. Methodologically, we apply k-means clustering to scientist-level data on research topics to assign each scientists to a research field, and then compare changes in patenting for the pre-quota fields of ESE-born US scientists with the pre-quota fields of other US scientists. Baseline estimates indicate that the quotas led to 68 percent decline in US invention in ESE fields. Decomposing this effect, we find that the quotas reduced not only the number of US scientists working in ESE fields, but also the number of patents per scientist. Firms that had employed ESE-born immigrants before the quotas experienced a 53 percent decline in invention. The quotas damaging effects on US invention persisted into the 1960s.
JEL Classifications
  • O3 - Innovation; Research and Development; Technological Change; Intellectual Property Rights
  • N0 - General