We examine the role of high-skilled foreign labor in VC-backed startups through two natural experiments. First, we show that winning more H-1B visas in random lotteries enhances VC-backed startups' financial performance, likelihood of going public, and quantity and quality of innovation. Second,...

We examine the value of skilled immigrants in finance by exploiting two natural experiments. We find that hedge fund management companies that secure more H-1B visas in random lotteries deliver higher alphas, Sharpe ratios, and information ratios. Moreover, an unexpected reduction in the H-1B...

In two natural experiments based on H-1B visa lotteries and a drastic cut in the annual H-1B visa quota, we document that firms respond to shortages in high-skilled workers by acquiring target firms that have these workers. Additional tests show that desire for the target's skilled labor is an...

Using random H-1B visa lotteries as a natural experiment, we document that firms respond to shortages of high-skilled workers by acquiring firms that have such workers and own negligible amounts of tangible assets. Additional tests show that desire for the targets’ skilled labor is an...