Higher Education, Immigration & Entrepreneurship

By  Ángel Cabrera and Callie LeRenard

In a prior blog post, we argued that world-class research universities drive competitiveness in a global economy more and more dependent on innovation and human talent.  The relationship between universities and competitiveness is multifaceted.  One of the mechanisms at work is tied to talent flow.  Here’s how it works:  world-class universities attract world-class students and faculty, and world-class students and faculty come from all across the globe.  High-density of talent drives entrepreneurship in innovative industries, and entrepreneurship is a core driver of economic growth.

A recent report by the Kauffman Foundation (pdf) found that immigrants were more than twice as likely as native-born Americans to start businesses each month in 2011, and among immigrants, 550 out of 100,000 people started a business each month compared with 270 out of 100,000 for the native-born.  In fact, as shown by the graph below, entrepreneurial activity among immigrants has grown dramatically in recent years, while entrepreneurial activity among the native-born has stayed relatively flat.

These entrepreneurs create jobs, foster innovation and fuel economic growth.  By attracting more talent, including budding entrepreneurs from overseas, universities contribute to economic growth in a very tangible way.