This paper studies the effects of skilled migration on innovation –proxied by patent citations- in European industries between 1994 and 2005, using the French and the UK Labour Force Surveys and the German Microcensus. Highly-educated migrants have a positive effect on innovation, but the effect differs across industries. It is stronger in industries with low levels of overeducation, high levels of FDIs and openness to trade and, finally, in industries with higher ethnic diversity. The aggregate effect of the skilled immigrant is about one third the one of the skilled natives. We tackle the endogeneity of migrants with a set of external and internal instruments.
Fassio, Claudio, Fabio Montobbio, and Alessandra Venturini. “Skilled migration and innovation in European industries.” Research Policy 48, no. 3 (2019): 706-718.
Claudio Fassio Associate Professor at the School of Economics and Management & at CIRCLE Lund University, Sweden
Claudio, thank you very much for accepting this invitation to have a coffee break with me, how are you doing?
I’m good thank you for inviting me. I have to confess today I’m having hot chocolate, it’s too cold for me today, are you having any coffee in Sweden? I’m having a Swedish coffee with some milk slowly getting used to it over the years.
I can imagine that Claudio. I want to talk with you today about the the paper you wrote about skilled migration and innovation in European industries, could you please tell me what the paper was about?
This is a paper co-written with Fabio Montobbio and Alessandra Venturini, my co-authors, what we studied was the impact of skilled immigration on innovation in three European countries, United Kingdom, France and Germany, what we we looked at was the the impact of skilled immigrants on the innovation performances of these countries and we took in particular focus on whether this effect differs across different industries.
And which ones were your key findings?
Our key findings are that we find that the there is an impact of uh skilled immigrants in in these European countries but their contribution to innovation their impact is lower than natives about one-third in our estimates and secondly we find that the impact is differentiated across different industries so we find that not surprisingly when there is some kind of over-education so when immigrants skilled immigrants do jobs that do not require the high level of education that they have their impact on innovation is lower and also we find that in sectors and industries with higher presence of multinational companies and of firms engaged in international trade the impact of skilled immigrants on innovation is higher.
How important that and I imagine from your personal experience being an Italian living in Sweden that can be also very interesting can you share some of the um personal motivation or experience that you had when writing the paper?
Yeah of course being uh working in a country that is different from from your own makes you understand the importance of this you know of these phenomenon, but generally speaking I’m also I was also motivated by the fact that I believe that the movement of ideas that comes through the movement of people is a fascinating phenomenon and benefits both the receiving countries but also the the individuals who engage in this type of of movement by enriching their knowledge and skill set.
Thank you for sharing I completely understand you on that and uh finally, which ones will you say are the most relevant policy implications of your paper?
Well the the first implication is that there is certainly in Europe room for improvement, we were motivated to to start these to this this study by the evidence coming from the from the U.S. where you see that most of the success of companies in the Silicon Valley and in other high-tech industries depend heavily on the inflow of engineers software’s engineers from countries such as China or India but not only those two countries so in in that context it looks like uh you know skilled immigration is a crucial factor what we seem to to find what we find in this in our in our analysis is that in Europe we still need to improve in terms of attracting people, skilled immigrants that are motivated, who could contribute possibly we have we also have a problem of finding the right jobs for this kind of people as shown by our findings on over education but probably one of the most interesting implications of our results is that we find that there are differentiated effects across industries and particularly that industry with a higher internationalisation seem to be better at benefiting from from skilled immigrants, so we what we suggest in the paper is that probably immigration policy and industrial policy could be better linked and in particular giving some more centrality to the role of firms, firms especially those that are interested in the international dimension of their business think about even small entrepreneurial firms that want to be born globals for example from the start and who struggle to find the right competences may benefit particularly for the inflow, from the possibility to hire skilled skilled personnel from abroad so we recommend that industrial policy and migration policy could be a little bit better matched together.
Claudio thank you very much for those valuable and very very relevant insights now and thank you again for your time to have a coffee break with me and I hope to see you soon. Bye bye, thank you. Thank you for watching if you’re interested in more details about this academic publication you can find here the link below, find us on Twitter, Facebook and Youtube or listen to our podcast on Spotify see you next time bye!