The role of high-skilled foreign labor in startup performance: Evidence from two natural experiments *

• 成果类型: Article
• 署名作者: Chen, Jun; Hshieh, Shenje; Zhang, Feng
• 署名单位: Renmin University of China; City University of Hong Kong; Utah System of Higher Education; University of Utah
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2021.05.042
• 发表日期: 2021
• 页码: 430-452
• 关键词: High-skilled foreign labor; H-1B visa; VC-backed companies; INNOVATION; Initial public offerings (IPOs)

摘要

We examine the role of high-skilled foreign labor in VC-backed startups through two natural experiments. First, we show that winning more H-1B visas in random lotteries enhances VC-backed startups' financial performance, likelihood of going public, and quantity and quality of innovation. Second, we show that the H-1B quota reduction in 2004 caused permanent damage to the performance of startups that previously had used H-1B workers. The findings imply that high-skilled foreign workers possess skills or talents that are difficult to replace and that barriers to securing H-1B visas lower startups' innovation and financial performance. Published by Elsevier B.V.