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11 September 2019updated 25 Jul 2021 4:00pm

In inventing new lives for themselves, immigrants learn to invent other things too

A study revealed that 43 per cent of companies in the Fortune 500 were founded or co-founded by immigrants or the children of immigrants.

By Matthew Syed

Take a look at the following list of names: Estée Lauder, Henry Ford, Elon Musk, Walt Disney and Sergey Brin. Can you see what they have in common? Others who share the connection include Arianna Huffington, Peter Thiel and Jerry Yang.

They are all immigrants, or the children of immigrants.

A study published in 2017 revealed that 43 per cent of companies in the Fortune 500 were founded or co-founded by immigrants or the children of immigrants (rising to 57 per cent in the top 35 companies). These 216 firms produced $5.3trn in global revenue and employed 12.1 million workers.

This is not an isolated finding. Immigrants make disproportionate contributions to technology, patent production and academic science. A 2016 paper in the Journal of Economic Perspectives showed that USbased researchers had been awarded 65 per cent of Nobel Prizes over the preceding few decades. More than half were born abroad.

Different studies have shown that immigrants are twice as likely to become entrepreneurs. They account for 13 per cent of the US population, but 27.5 per cent of those who start their own businesses. Data from the 2012 Global Entrepreneurship Monitor shows that the vast majority of the 69 countries surveyed reported higher entrepreneurial activity among immigrants than among natives.

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Why this pattern? A critical reason is that immigrants are more likely to question the status quo. They have experienced a different culture, a different way of doing things. When they see the business ideas in a new country, or a particular technology, they do not see something immutable or irrevocable. They see something that could potentially be adapted or reformed. A second reason concerns a covert transformation that has been taking place in the structure of innovation itself. In the 18th century, much innovation was “incremental”: directed, predictable steps that take one deeper into a given problem. Modern cases include James Dyson, patiently tweaking his vacuum cleaner, learning more about separation efficiency with each prototype.

Today, however, a different kind of innovation has moved front and centre: recombination. This is about taking ideas from different fields and fusing them together. A wheel with a suitcase, for example. Or a wine press with moveable type (resulting in the printing press). Recombination is often more dramatic, because it crosses domains and opens up new seams of possibility.

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A study published in the Web of Science which examined 17.9 million publications across 15,000 journals found that the highest impact papers were those with “atypical subject combinations”. These papers were blending, say, physics and computation, or economics and network theory, or psychology and evolutionary biology. This is what  we might call recombinant science. This is where the best ideas are now coming from.

The same is true of innovation more generally. The US Patent and Trademark Office has broad categories such as utility patents (the light bulb), design patents (the Coke bottle) and plant patents (hybrid corn). In the 19th century, most patents were classed by a single code. Today, that has dropped to just 12 per cent. In other words, the majority of modern innovations are reaching across the categories we impose on the world.

And this brings us back to immigration. Immigrants have experienced two cultures, so tend to have greater scope to bring ideas together. If the outsider perspective confers the ability to question the status quo, diversity of experience helps to facilitate recombination and provide the answers.

A study led by the economist Peter Vandor examined the capacity of students to come up with business ideas before and after a semester. Half the students went to live and study abroad during the semester, while the other half stayed in their home universities. Their ideas were then assessed by venture capitalists. Those who studied abroad had ideas that were rated 17 per cent higher than those who had not. Indeed, those who stayed in their home universities actually experienced a decline in the quality of their ideas over the course of the study.

This is not about immigration per se. After all, a fresh climate doesn’t have to be geographical. Charles Darwin alternated between research in zoology, psychology, botany and geology. This did not diminish his creative potential, but enhanced it. It gave him the chance to see his specialism from the outside and to fuse ideas from diverse branches of science. A 2009 study found that the most consistently original scientists switched topics, on average, a remarkable 43 times in their first 100 published papers.

Psychologists often talk about “conceptual distance”. When we are immersed in a topic, we are surrounded by its baroque intricacies. It is very easy to stay there, or to simply think about making superficial alterations to its interior. We become prisoners of our paradigms. Stepping outside the walls permits a new vantage point.

This is often considered to be a primary function of art. It is not about seeing something new, but about seeing something familiar in a new way. One thinks of the paintings of Picasso, which create conceptual distance between the viewer of the work and its object, the observer and the observed.

That is not to say that we don’t need insider expertise; quite the reverse. We need both conceptual depth, and conceptual distance. We need to be insiders and outsiders, natives and immigrants. The future will be catalysed by those who can operate not just within but also across categories. People who see walls not as immutable but as potentially breakable. 

Matthew Syed’s new book is “Rebel Ideas: the Power of Diverse Thinking” (John Murray)