Immigrant Entrepreneurship and the Institutional Context: A Theoretical Exploration

Posted: 24 Nov 2009

Date Written: 2000

Abstract

A theoretical starting point is offered for international comparative research on immigrant entrepreneurship, focusing on the relationship between the welfare system and immigrant entrepreneurship from a socio economic perspective.This approach combines three theoretical building blocks. The first block involves the assumption that immigrant entrepreneurs lack the human and financial capital to start businesses at the higher end of the market and are therefore confined to small, low-growth, low-tech firms. The second building block comprises an analysis of the recent reshuffling (brought about by globalization) of the low-tech segments of advanced societies. The third building block consists of the juxtaposition of two contrasting institutional frameworks, including a neo-American model and a Rhineland model. Marked by strong, low-wage job growth, the neo-American model offers many opportunities for immigrant entrepreneurship, although the fact that immigrants can easily find work as employees prevents many from engaging in entrepreneurial behavior. The Rhineland (or continental European) model, by contrast, is marked by high unemployment rates, which may push immigrants towards entrepreneurship, in spite of the social benefits received by the unemployed. Clearly, marked differences exist between the level and the incidence of immigrant entrepreneurship in welfare states of the neo-American and Rhineland types. (SAA)

Keywords: Globalization, Employment rates, Immigrants, Immigrant entrepreneurs, Social welfare

Suggested Citation

Kloosterman, Robert, Immigrant Entrepreneurship and the Institutional Context: A Theoretical Exploration (2000). University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship, Available at SSRN: https://ssrn.com/abstract=1512291

Robert Kloosterman (Contact Author)

affiliation not provided to SSRN

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