The low participation of urban migrant entrepreneurs: reasons and perceptions of weak institutional embeddedness

E. Masurel and Peter Nijkamp
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E. Masurel: Vrije Universiteit Amsterdam, Faculteit der Economische Wetenschappen en Econometrie (Free University Amsterdam, Faculty of Economics Sciences, Business Administration and Economitrics

No 40, Serie Research Memoranda from VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics

Abstract: The present paper addresses the lack of institutional collaboration among urban ethnic (or migrant) firms as a reason for their low innovation profile. This lack is present in various forms of institutional business cooperation, but here we focus in particular on franchising. Such weak collaborative embeddedness is noteworthy, given the fact that franchising offers for small and medium-sized enterprises (SMEs) an important means to compete better. Poor communication, a low chance to be accepted by the external party, and economic market factors appear to be important reasons why ethnic entrepreneurs do not join franchise organizations. The low chance of acceptance is primarily reflected in the entrepreneurs’ perception of their unfavorable market conditions, but in addition there are other reasons for low participation which can be rectified. From our research, general lessons can be derived which are applicable also to other situations in which ethnic entrepreneurs may also be less inclined to join institutional cooperative systems. With these lessons in mind, the competitive and innovative potential of ethnic entrepreneurs can be improved.

JEL-codes: L22 L81 M13 (search for similar items in EconPapers)
Date: 2009
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Chapter: The Low Participation of Urban Migrant Entrepreneurs: Reasons and Perceptions of Weak Institutional Embeddedness (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:vua:wpaper:2009-40

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