Immigration, Innovation, and Growth

Stephen J. Terry, Thomas Chaney, Konrad B. Burchardi, Lisa Tarquinio and Tarek Hassan

American Economic Review, 2026, vol. 116, issue 3, 828-61

Abstract: We propose a novel identification strategy to isolate exogenous immigration shocks across US counties, by interacting quasi-random variations in the composition of ancestry across counties with the contemporaneous inflow of migrants from different countries. We show a positive causal impact of immigration on local innovation and wages at the five-year horizon. The positive dynamic impact of immigration on innovation and wages dominates the short-run negative impact of increased labor supply. A structural estimation of a model of endogenous growth and migrations suggests the increased immigration to the United States since 1965 may have increased innovation and wages by 5 percent.

JEL-codes: J15 J22 J31 J61 O31 R11 R23 (search for similar items in EconPapers)
Date: 2026
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Immigration, Innovation, and Growth (2024)
Working Paper: Immigration, Innovation, and Growth (2024)
Working Paper: Immigration, Innovation, and Growth (2020)
Working Paper: Immigration, Innovation, and Growth (2020)
Working Paper: Immigration, Innovation, and Growth (2020)
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DOI: 10.1257/aer.20211601

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