Immigration and Innovation in European Regions

By Ceren Ozgen, Peter Nijkamp, Jacques Poot. Social Science Research Network, 2011

211 citations recorded by the source corpus.

The concentration of people with diverse socio-cultural backgrounds in particular geographic areas may boost the creation of new ideas, knowledge spillovers, entrepreneurship, and economic growth. In this paper we measure the impact of the size, skills, and diversity of immigration on the innovativeness of host regions. For this purpose we construct a panel of data on 170 regions in Europe (NUTS 2 level) for the periods 1991-1995 and 2001-2005. Innovation outcomes are measured by means of the number of patent applications per million inhabitants. Given the geographical concentration and subsequent diffusion of innovation activity, and the spatial selectivity of immigrants' location choices, we take account of spatial dependence and of the endogeneity of immigrant settlement in our econometric modelling. We use the location of McDonald's restaurants as a novel instrument for immigration. The results confirm that innovation is clearly a function of regional accessibility, industrial structure, human capital, and GDP growth. In addition, patent applications are positively affected by the diversity of the immigrant community beyond a critical minimum level. An increase in the fractionalization index by 0.1 from the regional mean of 0.5 increases patent applications per million inhabitants by about 0.2 percent. Moreover, the average skill level of immigrants (proxied by global regions of origin) also affects patent applications. In contrast, an increasing share of foreigners in the population does not conclusively impact on patent applications. Therefore, a distinct composition of immigrants from different backgrounds is a more important driving force for innovation than the sheer size of the immigrant population in a certain locality.

Subfields: Economics and Econometrics, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/f4695d30392211f8f2a9c2cbb933f74331356319

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Citations in the corpus

The impact of cultural diversity on firm innovation: evidence from Dutch micro-data (2013, background): “To date – with the exception of Parotta et al. (2011), Lee and Nathan (2010), Simonen and McCann (2008) and Almeida and Kogut (1999) – there has been very little empirical evidence that takes the presence and characteristics of foreign employees into account in identifying the determinants of innova”
Cultural Diversity, Innovation, and Entrepreneurship: Firm-level Evidence from London (2013, background): “Ozgen et al. (2011) found some positive links between the share of migrant workers, workforce diversity, and innovation in knowledge-intensive Dutch ﬁrms.”
Skilled migration and innovation in European industries (2019, background): “A growing set of papers analyses the European context with mixed results (Niebhur, 2010; Ozgen et al., 2012; Bratti and Conti, 2014).”
Global Talent Flows (2016, unknown): “12 For example, see Ozgen, Nijkamp, and Poot (2011); Parrotta, Pozzoli, and Pytlikova (2014); Bosetti, Cattaneo, and Verdolini (2015); Breschi, Lissoni, and Tarasconi (2014); Breschi, Lissoni, and Miguelez (2015); and Nathan (2015).”
Agglomeration and Innovation (2014, unknown): “Similar effects are discussed in Europe, with a particular link to fostering local diversity (e.g., Nathan, 2014; Ozgen et al., 2011; Parrotta et al., 2014).”
Same difference? Minority ethnic inventors, diversity and innovation in the UK (2015, background): “…USA, with only a handful of European studies exploring ethnicity– innovation connections: I am only aware of two area-level studies on diversity and patenting outcomes, Ozgen et al. (2012) and Niebuhr (2010), and no analysis at the individual or group level, where channels are most likely sited.”
Migrant and ethnic diversity, cities and innovation: Firm effects or city effects? (2015, background): “In situations of new product or process development, a variety of diverse cultures can help introduce ideas from elsewhere to be adapted and introduced in new forms (Nijkamp and Poot, 2011; Syrett and Sepulveda, 2011).”