The role of high-skilled foreign labor in startup performance : Evidence from two natural experiments
|Journal / Publication||Journal of Financial Economics|
|Online published||31 May 2021|
|Publication status||Published - Oct 2021|
|Link to Scopus||https://www.scopus.com/record/display.uri?eid=2-s2.0-85107994547&origin=recordpage|
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.
- H-1B visa, High-skilled foreign labor, Initial public offerings (IPOs), Innovation, VC-backed companies
Journal of Financial Economics, Vol. 142, No. 1, 10.2021, p. 430-452.
Research output: Journal Publications and Reviews (RGC: 21, 22, 62) › 21_Publication in refereed journal › peer-review
Chen, J, Hshieh, S & Zhang, F 2021, 'The role of high-skilled foreign labor in startup performance: Evidence from two natural experiments', Journal of Financial Economics, vol. 142, no. 1, pp. 430-452. https://doi.org/10.1016/j.jfineco.2021.05.042
Chen, J., Hshieh, S., & Zhang, F. (2021). The role of high-skilled foreign labor in startup performance: Evidence from two natural experiments. Journal of Financial Economics, 142(1), 430-452. https://doi.org/10.1016/j.jfineco.2021.05.042