Immigrant Entrepreneurship : Does the Liability of Foreignness Matter?

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Immigrant Entrepreneurship : Does the Liability of Foreignness Matter?

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Publication Article, peer reviewed scientific
Title Immigrant Entrepreneurship : Does the Liability of Foreignness Matter?
Author(s) Irastorza, Nahikari ; Peña, Iñaki
Date 2014
English abstract
The liability of foreignness is a phenomenon scarcely studied in the entrepreneurship literature. While immigrants seem to be prone to create new firms, they face different sorts of barriers to launch new businesses. We apply a binomial logistic regression on Global Entrepreneurship Monitor data to compare immigrants’ and natives’ entrepreneurial intentions to the actual self-employment activity of each group, and the factors affecting potential differences. We found that immigrants are more likely to have self-employment plans than natives but less likely to end up becoming self-employed. We explain this gap by the liability of foreignness hypothesis, i.e. additional difficulties faced by immigrants when entering the job market or starting up a business in a new country such as poor language skills, the lack of labour experience, the lack of human and social capital endowments specific to that country, and institutional restrictions including discrimination.
DOI (link to publisher's fulltext.)
Publisher Sciedu Press
Host/Issue Business and Management Research;1
Volume 3
ISSN 1927-6001
Pages 1-17
Language eng (iso)
Subject(s) Immigrants
Liability of foreignness
Institutional theory
Humanities/Social Sciences
Research Subject Categories::SOCIAL SCIENCES
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