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Immigration, Innovation, and the Geography of Growth

Author

Listed:
  • Costas Arkolakis

    (Yale University and NBER)

  • Sun Kyoung Lee

    (University of Michigan)

  • Michael Peters

    (Yale University and NBER)

Abstract

Between 1880 and 1920, more than 20 million immigrants settled in the United States. We study how this migration wave affected innovation and growth. Using a newly constructed dataset linking individual census records to historical immigration records and the universe of US patents, we highlight a new channel through which immigrants contributed to growth: they disproportionately settled in urban innovation hubs. To quantify the aggregate and regional effects of this mass migration episode, we develop a new spatial growth model in which skilled workers have a comparative advantage in innovation and sort endogenously across space. We find that international arrivals after 1880 raised US income per capita by 8.2% by 1940. Removing the subsequent immigration restrictions of the 1920s would have raised income per capita by a further 1.7% by 2000. Immigrants' skill composition and their concentration in urban hubs are key drivers of these effects.

Suggested Citation

  • Costas Arkolakis & Sun Kyoung Lee & Michael Peters, 2026. "Immigration, Innovation, and the Geography of Growth," Cowles Foundation Discussion Papers 2538, Cowles Foundation for Research in Economics, Yale University.
    • Handle: RePEc:cwl:cwldpp:2538
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    File URL: https://cowles.yale.edu/sites/default/files/2026-06/d2538.pdf
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    References listed on IDEAS

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