Abstract

The yearly cap on H-1B visas became binding for the first time in 2004, making it harder for college-educated foreigners to work in the United States. However, academic institutions are exempt from the cap, and citizens of five countries (Canada, Mexico, Chile, Singapore, and Australia) have access to alternative work visas. We exploit these exemptions to gauge how immigrant career choices have been affected by the binding visa cap. Among other impacts, the binding cap raises international students’ likelihood of employment in academia, even outside of their field of study, a result consistent with the notion of “settling” for academia.