Theses and Dissertations


Jun Cheng

Issuing Body

Mississippi State University


Millea, Meghan J.

Committee Member

Orozco-Aleman, Sandra

Committee Member

Lozano, Heriberto Gonzalez

Committee Member

Walters, Lurleen M.

Date of Degree


Document Type

Dissertation - Open Access


Applied Economics

Degree Name

Doctor of Philosophy (Ph.D)


College of Business


Department of Finance and Economics


The H-1B visa program was initiated in 1990 to temporarily hire highly-skilled foreign workers. The H-1B visa program has changed several times since its initiation. One of the most important changes occurred in 2001 when the 21st Century Act exempted individuals employed by institutions of higher education and nonprofit and government research organizations from the H-1B visa cap increasing the number of visas available for foreign high-skilled immigrants. To analyze the impact of policy changes affecting the H-1B program on highly-skilled workers, we study the behavior of foreign-born Ph.D. students who graduated from institutions in the United States over the 1990-2013 period. We estimate logit models to quantify the impacts on their stay rates and placement patterns. Our model shows that the exemption policy increased the probability of staying among STEM graduates, Chinese and Indian graduates, and among graduates from universities ranked as high research by Carnegie. These findings suggest that the labor market for non-STEM graduates was near its competitive equilibrium before the exemption policy came into effect. The exemption policy, which could potentially increase the quantity supplied of jobs, did not change the equilibrium quantity in this market, suggesting that the cap of H1-B visas was not binding among this type of graduates. Intuitively the exemption policy can increase or decrease the proportion of Ph.D. graduates in exempted positions. The proportion of graduates in exempted jobs increases as the number of visas for those types of jobs is excluded from the cap (direct effect). Conversely, if the number of candidates willing to take exempted jobs, or if the number of positions opened by exempted institutions are unchanged after the policy change, the increase in the availability of visas for non-exempted positions can increase the proportion of graduates in those types of jobs (indirect effect). The overall effect depends on the magnitude of the direct and indirect effect. Our findings also show that the exemption policy pushed doctoral degree recipients into higher education or affiliated research employment positions. Ph.D. recipients in STEM fields, and graduating from low-rank universities were more likely to go into exempt employment post-policy than before.