What is the U.S. Comparative Advantage in Entrepreneurship? Evidence from Israeli Migrations to the United States

We investigate underlying sources of the US entrepreneurial ecosystem's advantage compared to other innovative economies by assessing the benefits Israeli startups derive from migrating to the US. Addressing positive sorting into migration, we show that migrants raise larger funding amounts and are more likely to have a US trademark and be acquired than non-migrants. Migrants also achieve a higher acquisition value. However, their patent output is not larger. We conclude that the US entrepreneurial ecosystem's advantage vis-à-vis other innovative economies arises from several sources producing sizeable gains for startups. These sources are investor availability, and large consumer and acquisitions markets.