International students and innovation: Evidence from restrictions on US-trained foreign STEM workers
Abstract: This paper estimates how US policy restrictions on international STEM students affect the production of new, economically valuable technologies. A sudden 2008 expansion of Optional Practical Training (OPT) created a large, plausibly exogenous increase in the supply of US-trained foreign STEM workers across cities. Linking full-universe administrative OPT records to all subsequently granted US utility patents, I find that the evidence is consistent with each additional OPT STEM worker causing roughly 0.21 additional patents per year in the same city. This total effect, including within-city spillovers on the productivity of native inventors, is more than 1.7 times the direct effect of inventions by OPT STEM workers themselves. Weighted results show even larger impacts on influential and high-value patents citing scientific research literature, indicating that OPT STEM workers cause substantial gains in innovation quality.
Michael Clemens serves as a full professor of economics and founding faculty at the School of Government & Policy, Johns Hopkins University, and a Non-Resident Senior Fellow at the Peterson Institute for International Economics. He is an economist who studies policy innovation. Recently, he has been researching the causes and effects of international migration, advising public officials on how migration can work better for everyone, and empowering future policy leaders.
