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Migration, Cultural Diversity and Innovation: A European Perspective

Author

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  • Valentina Bosetti

    (Fondazione Eni Enrico Mattei and CMCC)

  • Cristina Cattaneo

    (Fondazione Eni Enrico Mattei and CMCC)

  • Elena Verdolini

    (Fondazione Eni Enrico Mattei and CMCC)

Abstract

This paper analyses the effect of skilled migration on two measures of innovation, patenting and citations of scientific publications, in a panel of 20 European countries. Skilled migrants positively contribute to the knowledge formation in host countries as they add to the pool of skills in destination markets. Moreover, they positively affect natives' productivity, as new ideas are likely to arise through the interaction of diverse cultures and diverse approaches in problem solving. The empirical findings we present support this prediction. Greater diversity in the skilled professions are associated with higher levels of knowledge creation, measured either by the number of patents applied for through the Patent Cooperation Treaty or by the number of citations to published articles. This finding is robust to the use of different proxies for both the explanatory variables and the diversity index in the labour force. Specifically, we first measure diversity with a novel indicator which uses information on the skill level of foreigners’ occupations. We then check our results by following the general literature, which measures skills by looking at the foreigners’ level of education. We show that cultural diversity consistently increases the innovation performance of European Countries.

Suggested Citation

  • Valentina Bosetti & Cristina Cattaneo & Elena Verdolini, 2012. "Migration, Cultural Diversity and Innovation: A European Perspective," Working Papers 2012.69, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2012.69
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    Cited by:

    1. Richter, Doreen, 2014. "Demographic change and innovation: The ongoing challenge from the diversity of the labor force," management revue. Socio-economic Studies, Rainer Hampp Verlag, vol. 25(3), pages 166-184.
    2. Sari Pekkala Kerr & William Kerr & Çağlar Özden & Christopher Parsons, 2017. "High-Skilled Migration and Agglomeration," Annual Review of Economics, Annual Reviews, vol. 9(1), pages 201-234, September.
    3. Kemeny, Thomas, 2013. "Immigrant diversity and economic development in cities: a critical review," LSE Research Online Documents on Economics 58458, London School of Economics and Political Science, LSE Library.
    4. Nathan, Max, 2014. "The wider economic impacts of high-skilled migrants: a survey of the literature for receiving countries," LSE Research Online Documents on Economics 57370, London School of Economics and Political Science, LSE Library.
    5. Keith McLeod & Richard Fabling & David C. Maré, 2014. "Hiring New Ideas: International Migration and Firm Innovation in New Zealand," Working Papers 14_14, Motu Economic and Public Policy Research.
    6. Sari Pekkala Kerr & William Kerr & Çağlar Özden & Christopher Parsons, 2016. "Global Talent Flows," Journal of Economic Perspectives, American Economic Association, vol. 30(4), pages 83-106, Fall.
    7. Khanh Hoang, 2015. "Aiding innovation and entrepreneurship through migration policy: A view from Australia," International Journal of Social Sciences, International Institute of Social and Economic Sciences, vol. 4(3), pages 59-81, August.
    8. Nathan, Max, 2013. "The Wider Economic Impacts of High-Skilled Migrants: A Survey of the Literature," IZA Discussion Papers 7653, Institute for the Study of Labor (IZA).
    9. Fassio, Claudio & Kalantaryan, Sona & Venturini, Alessandra, 2015. "Human Resources and Innovation: Total Factor Productivity and Foreign Human Capital," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201536, University of Turin.
    10. Jürgen Bitzer & Erkan Gören & Sanne Hiller, 2015. "Absorption of Foreign Knowledge: Firms’ Benefits of Employing Immigrants," Working Papers V-386-15, University of Oldenburg, Department of Economics, revised Oct 2015.
    11. Fassio, Claudio & Montobbio, Fabio & Venturini, Alessandra, 2015. "How Do Native and Migrant Workers Contribute to Innovation? A Study on France, Germany and the UK," IZA Discussion Papers 9062, Institute for the Study of Labor (IZA).
    12. Jan Ruffner & Michael Siegenthaler, 2016. "From Labor to Cash Flow? The Abolition of Immigration Restrictions and the Performance of Swiss Firms," KOF Working papers 16-424, KOF Swiss Economic Institute, ETH Zurich.
    13. Massimiliano Bratti & Chiara Conti, 2014. "The Effect of (Mostly Unskilled) Immigration on the Innovation of Italian Regions," ERSA conference papers ersa14p485, European Regional Science Association.
    14. Fassio, Claudio & Montobbio, Fabio & Venturini, Alessandra, 2015. "How Do Native and Migrant Workers Contribute to Innovation?," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 201507, University of Turin.
    15. Max Nathan, 2014. "The wider economic impacts of high-skilled migrants: a survey of the literature for receiving countries," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-20, December.
    16. Jaeger, David A & Ruist, Joakim & Stuhler, Jan, 2018. "Shift-Share Instruments and the Impact of Immigration," CEPR Discussion Papers 12701, C.E.P.R. Discussion Papers.
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    19. Oscar Afonso & Susana Gabriel & Pedro Mazeda Gil, 2016. "Could immigration explain wage inequality in a skill-biased technological model?," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 43(3), pages 559-577, August.
    20. Dramane Coulibaly & Blaise Gnimassoun & Valérie Mignon, 2018. "The tale of two international phenomena: International migration and global imbalances," Working Papers 2018-02, CEPII research center.
    21. Santos-Arteaga, Francisco J. & Di Caprio, Debora & Tavana, Madjid & O’Connor, Aidan, 2017. "Innovation dynamics and labor force restructuring with asymmetrically developed national innovation systems," International Business Review, Elsevier, vol. 26(1), pages 36-56.
    22. HASHIMOTO Yuki, 2017. "Highly Skilled Immigrants' Occupational Choices and the Japanese Employment System," Discussion papers 17059, Research Institute of Economy, Trade and Industry (RIETI).
    23. Fassio, Claudio & Kalantaryan, Sona & Venturini, Alessandra, 2015. "Human Resources and Innovation: Total Factor Productivity and Foreign Human Capital," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201536, University of Turin.
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    More about this item

    Keywords

    Cultural Diversity; Innovation; Skilled Migration; Knowledge Production Function; Europe;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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