Attracting talent: Location choices of foreign-born PhDs in the US (IGC Working Paper)
We use data from the National Science Foundation to examine the post-degree location choices of foreign-born students receiving PhDs from US universities in science and engineering. Individuals with advanced training in science and engineering are important inputs in the process of innovation. They are more likely than other college graduates or post-graduates to produce and to commercialize patents. Where they choose to live and work affects the global distribution of innovation capacity. In low-income countries, there are few opportunities to obtain advanced training in science and engineering, requiring students to pursue degrees abroad with many going to the United States. The success of these countries in luring back home students who obtain graduate degrees from US or other foreign universities determines their capacity for indigenous research and development. Over the period 1960 to 2008, 77% of foreign-born S&E PhDs state that they plan to stay in the United States. Graduates from low-income countries are relatively likely to seek US residence. However, intent to stay is noisy signal of actual location outcomes. Remaining in the US after graduation requires obtaining a work visa, which are in limited supply. Only 43% of S&E PhD recipients plan to stay and have made a commitment or signed a contract with an employer. Intent to stay and having a job may therefore be a more accurate measure of which graduates succeed in establishing residence in the United States.
We find that the foreign students more likely to stay in the US are those with stronger US ties, measured in terms of having a permanent residence visa or attended a US college, or stronger academic ability, measured in terms of parental educational attainment, the student’s success in obtaining graduate fellowships or scholarships, and the rank of the student’s university and academic department. Foreign students staying in the United States thus appear to be positively selected in terms of academic ability. These results are stronger for the joint outcome of intending to stay and having obtained a job, reinforcing the interpretation of positive selection. We also find that foreign students are more likely to stay in the United States if in recent years the US economy has had strong GDP growth, the birth country of the foreign student has had weak GDP growth, or the birth country has had an external debt crisis or major natural disaster. Foreign students are less likely to remain in the US if they are from countries with higher average income levels. As a country develops, its students obtaining degrees abroad become less likely to stay in the United States and more likely to return home. Education and innovation may therefore be part of a virtuous cycle in which education enhances prospects for innovation in low-income countries and innovation makes residing in these countries more attractive for individuals with advanced training in science and engineering.
Grogger, J.; Hanson, G.H. Attracting talent: Location choices of foreign-born PhDs in the US (IGC Working Paper). International Growth Centre (IGC), London, UK (2011) 39 pp.