Coping with H-1b Shortages: Firm Performance and Mitigation Strategies
- Resource Type
- Authors
- Anna Maria Mayda; Francesc Ortega; Giovanni Peri; Kevin Shih; Chad Sparber
- Source
- SSRN Electronic Journal.
- Subject
- Organizational Behavior and Human Resource Management
Management of Technology and Innovation
Strategy and Management
- Language
- ISSN
- 1556-5068
The H-1B visa program allows companies to hire skilled foreign workers. Before 2014, the vast majority of these visas were allocated on a first-come-first-served basis. Since then, the program has been severely oversubscribed and all cap-subject visas have been allocated through lotteries. The authors merged Compustat data with administrative firm-level data on the universe of approved petitions for H-1B visas. Using difference-in-differences and matching estimators, this article finds that the switch in the visa allocation system negatively affected the growth of companies that used the H-1B program. Results indicate that these effects are quantitatively large and that their magnitudes grow over time.