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UC Berkeley Web Feature

I-School Dean AnnaLee Saxenian assists with immigrant entrepreneurs study

– AnnaLee Saxenian, dean of the University of California, Berkeley's School of Information, is co-author of a new study released today (Thursday, Jan. 4) reporting that 25.3 percent of the engineering and technology companies established in the United States in the past decade were founded by immigrant entrepreneurs.

Saxenian teamed up with researchers at Duke University for the report, titled "America's New Immigrant Entrepreneurs."

The authors also concluded that these firms founded by U.S. immigrants produced $52 billion in sales and employed 450,000 workers. It found as well that foreign nationals living in the United States accounted for approximately 24 percent of international patent applications filed last year.

California leads the nation in immigrant entrepreneurship. The study shows that 39 percent of technology firms in the state have at least one foreign-born founder, compared to the national average of 25.3 percent. In Silicon Valley the proportion is even higher: 52.4 percent of companies in the region have immigrant founders, with the greatest proportion from India, China, and Taiwan.

"In places like Silicon Valley we see the compounding impacts of immigrant social and technical networks," Saxenian said. "As foreign-born engineers start businesses, they collaborate with former classmates and colleagues from their home countries, sharing the business contacts and know-how as well as market information that support entrepreneurial success. Successful entrepreneurs not only contribute to the regional economy, but also become powerful role models and mentors, attracting subsequent generations of immigrants to the area."

Saxenian, an economic geographer, has conducted extensive research on immigrant entrepreneurs in Silicon Valley, which attracts more foreign-born scientists and engineers than any other technology center in the country.

As a co-author of the Duke study, she was heavily involved in the design of the study's methodology and the analysis of the data, as well as some of the writing for the report.

A groundbreaking report by Saxenian in 1999 found that Chinese and Indian engineers led 24 percent of the technology companies in the Silicon Valley created between 1980 and 1998.

The new study indicates that the situation is also true nationally, and still on the increase in Silicon Valley. The researchers report that 52.4 percent of the 126 companies in Santa Clara, Alameda, San Mateo and Santa Cruz counties that responded to the Duke students' survey said their key founders were immigrants, up from a statewide average of 38.8 percent.

In Silicon Valley in 2000, some 53 percent of its science and engineering workforce was foreign-born, while the percentage is less than one-fourth in other tech centers such as Boston and Austin.

The Duke study is available online (PDF format). The research is based on census and patent information, financial databases and telephone surveys of 2,054 engineering and technology companies founded between 1995 and 2000.

Saxenian recently published "The New Argonauts: Regional Advantage in a Global Economy." The book looks at how and why immigrant engineers from Silicon Valley are creating an international "brain circulation" rather than a "brain drain" by transferring their technological entrepreneurship to emerging nations such as India and China.