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Ethnic Innovation and U.S. Multinational Firm Activity

  • C. Fritz Foley
  • William R. Kerr

This paper studies the impact that immigrant innovators have on the global activities of U.S. firms by analyzing detailed data on patent applications and on the operations of the foreign affiliates of U.S. multinational firms. The results indicate that increases in the share of a firm's innovation performed by inventors of a particular ethnicity are associated with increases in the share of that firm's affiliate activity in their native countries. Ethnic innovators also appear to facilitate the disintegration of innovative activity across borders and to allow U.S. multinationals to form new affiliates abroad without the support of local joint venture partners. Thus, this paper points out that immigration can enhance the competitiveness of multinational firms.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17336.

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Date of creation: Aug 2011
Date of revision:
Publication status: published as With William R. Kerr, “Ethnic Innovation and U.S. Multinational Activity,” Management Science , Vol. 59, No. 7, pp. 1529-1544, 2013.
Handle: RePEc:nbr:nberwo:17336
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