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Skilled Immigration Frictions as a Barrier for Young Firms

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This paper studies the impact of skilled immigration policy frictions in the United States on technology-intensive firms by age cohorts. We use firm-level data and a general equilibrium model with endogenous firm entry and exit. The empirical results show that skilled immigration policy frictions directly influence young firm dynamics in technology-intensive sectors by affecting firm survival. Our general equilibrium model incorporates skilled foreign labor and immigration policy frictions that mimic the H-1B policy and matches the age distribution of firms in high-technology sectors, showing also that increased entry of younger firms leads to a greater exit of older firms.

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  • Federico S. Mandelman & Mehra dup Mishita & Hewei Shen, 2024. "Skilled Immigration Frictions as a Barrier for Young Firms," FRB Atlanta Working Paper 2024-2, Federal Reserve Bank of Atlanta.
    • Handle: RePEc:fip:fedawp:97726
    DOI: 10.29338/wp2024-02
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    More about this item

    Keywords

    skilled immigration; start-ups; high-technology firms; firm dynamics;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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