The Effect of the H-1B Quota on the Employment and Selection of Foreign-Born Labor

Anna Maria Mayda, Francesc Ortega, Giovanni Peri, Kevin Shih () and Chad Sparber

No 11345, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The H-1B program allows skilled foreign-born individuals to work in the United States. The annual quota on new H-1B issuances fell from 195,000 to 65,000 for employees of most firms in fiscal year 2004. This cap did not apply to new employees of colleges, universities, and non-profit research institutions. Existing H-1B holders seeking to renew their visa were also exempt from the quota. Using a triple difference approach, this paper demonstrates that cap restrictions significantly reduced the employment of new H-1B workers in for-profit firms relative to what would have occurred in an unconstrained environment. Employment of similar natives in for-profit firms did not change, consistent with a low degree of substitutability between H-1B and native workers. The restriction also redistributed H-1Bs toward computer-related occupations, Indian-born workers, and firms using the H-1B program intensively.

Keywords: natural experiment; H-1B; skilled workers (search for similar items in EconPapers)
JEL-codes: F22 J61 O33 R10 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2018-02
References: Add references at CitEc
Citations: View citations in EconPapers (24)

Published - published in: European Economic Review, 2018, 108, 105-128

Downloads: (external link)
https://docs.iza.org/dp11345.pdf (application/pdf)

Related works:
Journal Article: The effect of the H-1B quota on the employment and selection of foreign-born labor (2018)
Working Paper: The Effect of the H-1B Quota on the Employment and Selection of Foreign-Born Labor (2018)
Working Paper: The Effect of the H-1B Quota on Employment and Selection of Foreign-Born Labor (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp11345

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().