Study Links 2017 H-1B Policy to Regional Productivity Decline
7 reported
A new research paper estimates that the 2017 “Buy American, Hire American” (BAHA) executive order, which tightened H-1B visa adjudication, led to a decline in regional productivity. The study, authored by Caroline Y. Su of McLean High School, found that states highly dependent on H-1B talent experienced a 2.8% relative decline in value-added output. This productivity loss was estimated at roughly $218 billion across the most affected regions. The paper notes that concurrent tax cuts and deregulation likely offset the impact on employment and wages, but the loss of specialized STEM expertise adversely affected total factor productivity. The findings suggest that policies based on conventional employment metrics may overlook the “hidden damage” to productivity and innovation. The study was highlighted by Kevin Lewis.
What’s reported
The 2017 BAHA policy significantly tightened H-1B visa adjudication.
New employment petition denial rates doubled from 7% to 17%.
STEM-specific rejections tripled to 31%.
States highly dependent on H-1B talent saw a 2.8% relative decline in value-added output.
The productivity loss was estimated at roughly $218 billion across the most affected regions.
Concurrent tax cuts and deregulation likely offset the impact on employment and wages.
The loss of specialized STEM expertise adversely impacted total factor productivity.
Key figures
Caroline Y. Su (author, McLean High School)
Kevin Lewis (highlighted the study)
Sources: marginalrevolution.com
