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Posted: comet.paws on  Oct 18 10:39:55 AM
Title: How Do Restrictions on High-Skilled Immigration Affect Offshoring? Evidence from the H-1B Program  
Britta Glennon
Carnegie Mellon
Sponsor: Carnegie Mellon University
Series: SETChange Seminar
Date: Oct 18, 2018 12:00 PM - 1:30 PM
Location: Baker Hall 129
Paper: http://
Detail: Abstract of How Do Restrictions on High-Skilled Immigration Affect Offshoring? Evidence from the H-1B Program

The decision to encourage or restrict high-skilled immigration has long been controversial. Advocates argue that high-skilled immigration is critical for firm competitiveness and innovation; critics argue that skilled immigrants displace native workers and drive down wages. The debate, however, has largely overlooked the secondary consequences of restrictions on high-skilled hiring of immigrants: multinational firms faced with decreased access to visas for skilled workers have an offshoring option, namely, hiring the foreign labor they need at their foreign affiliates. This paper documents the impact of restrictive high-skilled immigration policies on the globalization of high-skilled activity by US MNCs. I use a unique matched firm-level dataset of H-1B visas and multinational firm activity and two different identification strategies to examine three key questions about that impact. First, do restrictions on H-1B visas result in increased foreign affiliate activity? Second, how does any impact differ across firms, industries, and countries? Finally, do these restrictions also affect the location of innovative activity? Both strategies yield the same result: that restrictions on H-1B immigration caused increases in foreign affiliate activity at both the intensive (US multinationals employed more people at their foreign affiliates) and the extensive (US multinationals opened more foreign affiliates conducting R&D) margins.
Interest Area: Computer & Information Science & Engineering, Social, Behavioral & Economic Sciences
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