Why are immigrants dominating American industry and innovation?

The realms of industry, technology, and innovation are no longer solely the domain of those who happened to be born and raised in North America. In recent years, a near majority of startups and new patent issuances have been granted to foreign born individuals and associated corporate entities. While there are several pros and cons inherent to this recent trend, its effect on the overall economy is undeniable and irreversible.

Regardless of these myriad economic effects, it’s important to examine the reasons why foreigners are more likely to choose North America, and specifically the United States as their nation of choice to invest and invent in. The tax and copyright laws in the United States make it an extremely business friendly environment, drawing in investment from all over the world. Current laws, while not perfect, entice foreign investment in such a way as to be irresistible for companies who want to remain relevant of the current world stage. The reach and market penetration provided by the American economic model is invaluable to any company that wishes to grow.

Under the advent of globalization, the need for human intellectual capital is higher than ever. It is far more economically advantageous for an educated person to make the trip across national borders if the laws of the country that they are destined for happen to be friendlier towards their future economic prospects and long term financial stability. An example of this fertile environment can be found in United States patent and copyright laws which enable inventors to retain control over their products and intellectual property for the most time out of any other nation on the face of the Earth.

The drive to leave one’s home nation in search of a better life elsewhere can be intense. Those individuals with enough enterprise to take their valuable skills out of their home country and bring them to the United States have a tendency to be the proverbial cream of the crop. While they could easily be successful in their home nations, they make the profound decision to uproot their lives in their entirety under the promise of greater opportunities elsewhere. Any person willing to make such a sacrifice does not do so lightly. Such a risk is simply not undertaken by reasonable people without the promise of a potentially tremendous reward.

In turn, these new Americans add vital human, intellectual, and economic capital to the economy. Through their often family run businesses, immigrants can employ countless Americans, adding to the growth of the economy as a whole. Often, these first settlers will sponsor their families’ journeys later on, only to set them up with positions in the companies that they have already founded or even put them on the path towards owning businesses of their own.

Innovation through patent issuance is another key factor that bears examination. It cannot be denied that there remains a massive incentive to improve the conditions of one’s country of birth through innovation and invention. However, free market forces may not facilitate this desire financially outside of the western world. The simple fact of the matter is that the intellectual property laws of the United States encourage invention and investment into new technologies while simultaneously mitigating the risks to the inventor and maximizing the potential reward.

Current immigration policy may be cutting the American economy off from these valuable sources of innovation and economic activity. Regardless of the climate at home, the concept of the “American Dream” is still alive and well in the hearts and minds of the tens of thousands of immigrants who come to live, work, invest, and invent in America every year. In today’s globalized economy, the dominance of immigrants in business and innovation will not reverse. The question we must ask ourselves is how we will adapt to and exploit this trend in such a way so as to benefit all.

Torrey Hills Technologies is one such immigrant owned and operated enterprise who applies these principles in the real world. The company, based in California, produces award winning tungsten based belt furnaces. The drive and dedication displayed by the owners and employees of the company exemplifies the intense work ethic and innovating spirit inherent to many of those individuals who uproot their entire lives for new business ventures in America.

Their business model is unique to say the least. Every furnace, and most of the three roll mills, that they sell comes with a 100% money back guarantee. Rather than issuing the refund in the form of cash or a liquid asset however, they issue it in the form of an annuity through Delaware Life or US Savings Bonds. While this certainly can seem like a risk to some, in some ways it is actually rather creative and could be a net positive for consumers. At any point, you can sell your bonds. However, it may be better in some circumstances to hang on to them for a length of time. Savings bonds, by their very design, tend to appreciate and pay annuities or dividends over time. Assuming the stability of the state where you have purchased them from, you may be able to get back all of your money and then some.

Caution under such a scheme is certainly understandable. For some, it may turn out to be a win-win scenario that benefits both parties equally. Regardless, the company certainly has an incentive to ensure your satisfaction with their product irrespective of how you receive your refund should you require one. They simply provide you with a means of earning more if you do, and that may inspire trust.

Note: The article was written by Kelsey Béland, posted here with her permission.