Impact of social and human capital on business performance of migrant entrepreneurs - a comparative dutch-us study

Peter Nijkamp, R. Stough and M. Sahin

No 17, Serie Research Memoranda from VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics

Abstract: The past decades have shown a remarkable growth in entrepreneurship among migrants. Recent studies on ethnic entrepreneurship have pointed at an increasing share of migrants in urban small- and medium-sized entrepreneurial businesses. These migrant activities are crucial to the urban economy in many countries, as they employ a significant part of the workforce. This paper aims to identify the empirical factors that are responsible for successful migrant entrepreneurship, using concepts from social and human capital theory. We first offer an overview of some basics from the literature on social capital and human capital, and next a general background sketch of ethnic entrepreneurship in the EU and US. Then we position these concepts in a multicultural framework, in which new socio-cultural conditions such as the emergence of migrant entrepreneurship play an important role. The empirical part of the paper is based on a survey questionnaire among migrant entrepreneurs in Amsterdam (the Netherlands) and Fairfax (USA). We investigate success conditions of ethnic entrepreneurship in both areas and present an overview of cultural, ethno-psychological and motivational aspects that contribute to the understanding of similarities and differences between ethnic entrepreneurs in the Netherlands and the US. This analysis is structured around several dimensions of social and human capital including personal and business characteristics, and network participation for improving business performance. The findings of the two studies are compared to explore a possible correspondence in business performance patterns. The research tool used to assess performance is Data Envelopment Analysis (DEA), a technique for comparative efficiency analysis in various types of corporate organizations. Finally, concluding remarks are presented and possible extensions of the

Keywords: Data Envelopment Analysis; migrant entrepreneurship; social and human capital (search for similar items in EconPapers)
JEL-codes: L R (search for similar items in EconPapers)
Date: 2009
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