Jeffrey Miron
The Trump administration has attempted to limit H1B (high-skilled) visas, with varying degrees of success.
New research sheds light on the impact of these policy changes, should they survive legal challenges. The study looks at
hedge fund firms that applied for visas during lottery years [~2004] and compared their investment performance according to the share of requested visas they received. … The differences were economically meaningful. A portfolio of hedge funds with the highest visa lottery success rates outperformed a portfolio of funds with the lowest success rates by 3.28 percentage points per year after adjusting for risk.
Interestingly,
[h]edge funds that received more H‑1B workers posted fewer jobs for domestic STEM workers but more jobs for domestic workers in complementary fields outside economics, finance, and STEM. This pattern suggests that skilled immigrants can help firms grow in ways that create demand for other US workers.
Altogether,
the study indicates that skilled immigrants add value in finance, especially where quantitative expertise is central to performance. It suggests that restrictions on high-skilled immigration can affect not only technology firms but also investment management and other sectors that depend on specialized analytical talent.
