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Migration, Cultural Diversity and Innovation: A European Perspective

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  • Valentina Bosetti
  • Cristina Cattaneo
  • Elena Verdolini

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. Keywords: cultural diversity, innovation, skilled migration, knowledge production function, Europe JEL: F22, J24, O31

Suggested Citation

  • Valentina Bosetti & Cristina Cattaneo & Elena Verdolini, 2012. "Migration, Cultural Diversity and Innovation: A European Perspective," Working Papers 469, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  • Handle: RePEc:igi:igierp:469
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    References listed on IDEAS

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    1. Malerba, Franco, 1992. "Learning by Firms and Incremental Technical Change," Economic Journal, Royal Economic Society, vol. 102(413), pages 845-859, July.
    2. Hartog, Joop, 2000. "Over-education and earnings: where are we, where should we go?," Economics of Education Review, Elsevier, vol. 19(2), pages 131-147, April.
    3. Pierpaolo Parrotta & Dario Pozzoli & Mariola Pytlikova, 2014. "The nexus between labor diversity and firm’s innovation," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(2), pages 303-364, April.
    4. Iranzo, Susana & Peri, Giovanni, 2009. "Migration and trade: Theory with an application to the Eastern-Western European integration," Journal of International Economics, Elsevier, vol. 79(1), pages 1-19, September.
    5. Maskus, Keith & Mobarak, Ahmed Mushfiq & Stuen, Eric T., 2010. "Skilled Immigration and Innovation: Evidence from Enrollment Fluctuations in U.S. Doctoral Programs," CEPR Discussion Papers 7709, C.E.P.R. Discussion Papers.
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    7. Mancusi, Maria Luisa, 2008. "International spillovers and absorptive capacity: A cross-country cross-sector analysis based on patents and citations," Journal of International Economics, Elsevier, vol. 76(2), pages 155-165, December.
    8. Carayol, Nicolas & Matt, Mireille, 2004. "Does research organization influence academic production?: Laboratory level evidence from a large European university," Research Policy, Elsevier, vol. 33(8), pages 1081-1102, October.
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    11. Giovanni Peri & Susana Iranzo, 2009. "Migration and Trade: Theory with an Application to the Eastern-Western European Integration," Working Papers 81, University of California, Davis, Department of Economics.
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    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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