How Entrepreneurially Influential Social Traits and the Concentration of Immigrants Affect Business Creation Among Rural Immigrants

Abstract

Immigrants have mainly been studied as part of the wage-earning workforce. However, they can become entrepreneurs. There is evidence in the literature that immigrants can be relatively more entrepreneurial than local inhabitants. Previous studies indicate that immigrants do not have any greater entrepreneurial capacity in rural areas, but local inhabitants do. The objective of this study is to determine the impact of rurality and the geographical concentration of immigrants on the entrepreneurship of foreigners. The paper also studies the influence over immigrant entrepreneurial activity of socio-institutional factors such as role models, the perception of social fear of failure and the perception that becoming an entrepreneur increases social status. To conduct this study, a logit model adjusted for rare events was applied using the GEM survey (Global Entrepreneur Monitor) for Spain for the year 2007. The results indicate that the concentration of immigrants plays a determinant role in explaining the impact of rurality and socio-institutional factors on foreign entrepreneurial activity.

Keywords: Immigrants, Entrepreneurship, Rural areas, Concentration of Immigrants

JEL Classification: M13, O18