The Contribution of Foreign Doctoral Students on Innovation in the United States

Project Summary

This project adds to the literature surrounding the current debate on the contribution of foreign students to the U.S. and their effect on native wages in both low and high-skilled labor.  Current research demonstrates that despite deficiencies in math and science training among American secondary school students, the United States has sustained its primary position as a developer of new scientific knowledge, arguably as a result of foreign doctoral students.  This project addresses the gap in current research that demonstrates a correlation between the highest-caliber graduate students from around the world and high-quality research and productivity (measured by the number of articles published, the frequency by which they are cited, and patent applications).
In order to test the hypothesis that foreign students are important contributors to knowledge creation in U.S. universities, this project looks at the relationship between the role and productivity of foreign students using U.S. economy panel data of 2300 science and engineering departments at 100 large American universities from 1973 to 1998.  This project addresses the possibility that correlation between enrollment and productivity could be attributed to omitted variables, including increases in foreign applications due to an improvement in faculty quality or greater funding and decreases in foreign applications due to an increase in American students, by isolating potential causal impacts through the use of an instrumental variables strategy.  The research uses fluctuations in foreign students’ applications to a specific department in U.S. institutions as a result of macroeconomic shocks and policy changes in source countries to isolate changes in publishing within that academic department.
The findings show that foreign doctoral students significantly and positively influence publications and citations produced by U.S. academic departments; a 10% reduction in the foreign-student share would have reduced citations and publications by 5-6% in the average department over our time period.  However, a larger share of foreign students has an adverse effect on high-quality scientific achievement of academic departments, demonstrating that it is the diversity which leads to higher quality research output in collaborative fields.  The findings show that a diverse student classroom allows for the exchange and mixing of both complementary and heterogeneous skills and encourages cross-country research collaborations. Diversity demonstrated a large positive and significant effect on publications and citations, with a 10% increase in diversity correlating with a 10% rise in both publications and citations, and the replacement of one in twenty American students with a foreigner leading to at least 2.77 more publications.  This analysis adds to the existing literature by documenting the key benefits of high-skilled immigration in the U.S.—a country that relies heavily on innovation for growth—and perhaps will be useful in the future in thinking about the student-immigration policy debate.

Research Partners:

  • Eric T. Stuen (University of Idaho), Keith E. Maskus (University of Colorado at Boulder)


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