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MIGRANT ENTREPRENEURS' ACCESS TO BUSINESS FINANCE IN AUSTRALIA

Andrew van Hulten () and Abdullahi Ahmed
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Andrew van Hulten: Center for Strategic Economic Studies, Victoria University, 300 Flinders Street, 3000 Melbourne, Australia

Journal of Developmental Entrepreneurship (JDE), 2013, vol. 18, issue 01, 1-22

Abstract: Migration status has been neglected both theoretically and empirically in the financial discrimination literature. Drawing on data from a comprehensive survey of small- and medium-sized businesses in Australia, this paper tests whether Australia's migrant entrepreneurs have greater difficulty accessing external business finance than their Australia-born counterparts. In doing so, it tests the theoretical proposition that the passage of time (or time spent in Australia) mediates a relationship between migration status and access to business finance by determining borrow-lender information asymmetries. We find that long-term migrant entrepreneurs are more likely than Australia-born entrepreneurs to: (1) report access to finance as an obstacle, (2) pass up investment opportunities because of inadequate access to finance, and (3) have obtained funding from family and friends. However, no significant differences are found between migrant and Australia-born entrepreneurs in terms of denial and discouragement rates, or their past use of bank finance.

Keywords: Financial discrimination; discouraged borrowers; migrant entrepreneurship; SME finance (search for similar items in EconPapers)
Date: 2013
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DOI: 10.1142/S1084946713500039

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