News — Tight restrictions on student visas for foreign graduate students will hasten the erosion of America's global dominance in innovation, according to a University of Colorado at Boulder researcher.
In the first study of its kind, economics Professor Keith Maskus found that strict enforcement of restrictions on student visas could wipe out much of the innovative activity sparked by the Bayh-Dole Act of 1980, which allows U.S. universities to commercialize research results.
He also found that a 10 percent increase in the number of foreign graduate students in the United States would raise patent applications by 3.3 percent, while patents granted to universities would increase by 6 percent and non-university patent grants by 4 percent, all of which help fuel economic growth in the United States.
However, as recent surveys have shown, the trend is going in the opposite direction, with fewer foreign graduate students entering U.S. universities during the years since 9-11. The study, conducted by Maskus and colleagues Gnanaraj Chellaraj and Aaditya Mattoo of the World Bank, provides the first systematic economic results about the contributions of foreign graduate students and skilled immigrants to U.S. innovation and technological change. "There has always been a suggestion that foreign graduate students in areas like math and engineering have had a positive impact on innovation, but nobody has studied that in the past," Maskus said.
Plugging data from the U.S. Census Bureau and the National Science Foundation into a model, the researchers tested the productivity of domestic and foreign graduate students and domestic and foreign skilled workers in producing patent awards to university and private businesses.
"Our results show that foreign graduate students and immigrants under technical visas are vital when it comes to developing new technologies in the American economy," Maskus said. "The impacts are particularly pronounced within the universities but spill over as well to non-university patenting."
Innovation is important for economic growth because when a successful product is developed and patented, it can't be reproduced without permission of the patent holder, meaning the profit margin will be higher until the patent expires.
Studies have shown that recent growth in the U.S. economy has been generated largely by advances in technology and these technology improvements have mostly been driven by the rate of innovation.
Annual licensing revenue from U.S. patents amounts to tens of billions of dollars, with pharmaceutical, biotechnology and informational technology industries among the leaders.
The study also found that U.S.-born graduate students have no detectable effect on patent applications or grants. Maskus explained that this is largely due to the fact that American-born students tend to study other areas outside of the sciences and engineering, which are leading areas in innovation.
"There is still a much higher return for American students to learn to run a company or become lawyers," Maskus said.
Currently, the United States enjoys an advantage in exporting the services of higher education, especially in training scientists and engineers, according to Maskus. But as other countries improve their graduate science programs, visa restrictions could really put U.S. institutions at a competitive disadvantage.
"This is just part of the story," Maskus said. "The bigger element in globalization is China and India are getting their economic acts together. One thing we can do to help keep our competitive edge, though, is make sure that capable foreign graduate students can come here to study.
"I think the United States will continue to lead the world in innovation, but we will not be as dominant as we are today," he said.
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