Authors: Valentina Bosetti, Cristina Cattaneo and Elena Verdolini

The contribution of foreigners to the creation of knowledge has been under-researched in the empirical ground. First, the existing literature quite exclusively focused on US while other important places of innovation production have hardly been considered. Second, given the inherently difficult task of finding a proper measure of innovative activity, these studies have mainly applied patent data. The assumption that patents reflect innovative activity is validated in a number of studies. Nevertheless, this measure is only an imperfect indicator of inventive activity.
To fill in the existing gap in the empirical literature, in this paper we analyse the effect of skilled migration on different measures of innovation, namely patenting and scientific publications, in a panel of European countries from 1997 to 2007. Skilled migrants may positively contribute to the knowledge formation in host countries as they simply add to the pool of skills in destination markets. Moreover, they might positively affect natives’ productivity, as new ideas are likely to arise through the interaction of diverse cultures and diverse approaches in problem solving.
Preliminary results confirm that ethnic diversity among skilled workers contributes to the creation of knowledge, augmenting the number of patents. Moreover, more favourable and less cumbersome visa applications directed to attract skilled labour are found to increase the share of skilled foreigners on the labour force, contributing indirectly to boost scientific knowledge.