Working Paper: NBER ID: w25565
Authors: J. David Brown; John S. Earle; Mee Jung Kim; Kyung Min Lee
Abstract: We estimate differences in innovation behavior between foreign versus U.S.-born entrepreneurs in high-tech industries. Our data come from the Annual Survey of Entrepreneurs, a random sample of firms with detailed information on owner characteristics and innovation activities. We find uniformly higher rates of innovation in immigrant-owned firms for 15 of 16 different innovation measures; the only exception is for copyright/trademark. The immigrant advantage holds for older firms as well as for recent start-ups and for every level of the entrepreneur’s education. The size of the estimated immigrant-native differences in product and process innovation activities rises with detailed controls for demographic and human capital characteristics but falls for R&D and patenting. Controlling for finance, motivations, and industry reduces all coefficients, but for most measures and specifications immigrants are estimated to have a sizable advantage in innovation.
Keywords: Immigrant Entrepreneurs; Innovation; High-Tech Sector
JEL Codes: F22; F61; F66; J15; J6; L26; O3; O31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| immigrant ownership status (mij) (F22) | product innovation (O35) |
| immigrant ownership status (mij) (F22) | process innovation (O31) |
| immigrant ownership status (mij) (F22) | R&D activities (O32) |
| immigrant ownership status (mij) (F22) | intellectual property ownership (O34) |
| demographic and human capital characteristics (J21) | immigrant-native differences in innovation activities (O36) |
| financial motivations and industry (G29) | immigrant-native differences in innovation measures (J61) |
| immigrant ownership status (mij) (F22) | innovation behavior (O35) |
| immigrant ownership status (mij) (F22) | developing new uses for goods or services (O35) |