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Title: The Effect of Immigration on U.S. Natives' Innovation and Entrepreneurship

Citation Type: Miscellaneous

Publication Year: 2009

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Abstract: What are the benefits of immigration? A small body of literature has examined a variety of benefits of immigration to the U.S.: how they affect GDP, how they affect the efficiency of the labor market, whether they are a net fiscal gain or drain, and how much they lower price levels. However, very little research has examined how immigrants affect the level and character of entrepreneurial activity in the U.S. This paper pursues a new path in this nascent field by directly focusing on immigration’s effect on natives’ entrepreneurship and propensity to innovate via a labor supply effect. We first posit a theoretical model that predicts that immigrants, particularly those possessing skills that are not immediately transferable to the U.S. labor market, facilitate innovation and entrepreneurship by being willing and able to invest in new skills. At the heart of our theoretical prediction that immigration facilities entrepreneurship is the observation that human capital not immediately valued in the U.S. labor market may still be useful for learning new skills (an insight from cognitive science theory) and therefore . . .

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Authors: Duleep, Harriet O.; Jaeger, David A.

Publisher: European Association of Labor Economists

Data Collections: IPUMS USA

Topics: Labor Force and Occupational Structure, Migration and Immigration

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