Diasporas and Domestic Entrepreneurs: Evidence from the Indian Software Industry

22 Pages Posted: 10 Jan 2011

See all articles by Ramana Nanda

Ramana Nanda

Harvard University - Entrepreneurial Management Unit

Tarun Khanna

Harvard University - Strategy Unit

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Abstract

This study explores the importance of cross-border social networks for entrepreneurs in developing countries by examining ties between the Indian expatriate community and local entrepreneurs in India's software industry. We find that local entrepreneurs who have previously lived outside India rely significantly more on diaspora networks for business leads and financing. This is especially true for entrepreneurs who are based outside software hubs where getting leads to new businesses and accessing finance is more difficult. Our results provide micro-evidence consistent with a view that cross-border social networks play an important role in helping entrepreneurs to circumvent the barriers arising from imperfect domestic institutions in developing countries.

Suggested Citation

Nanda, Ramana and Khanna, Tarun, Diasporas and Domestic Entrepreneurs: Evidence from the Indian Software Industry. Journal of Economics & Management Strategy, Vol. 19, No. 4, pp. 991-1012, 2010. Available at SSRN: https://ssrn.com/abstract=1733740 or http://dx.doi.org/10.1111/j.1530-9134.2010.00275.x

Ramana Nanda (Contact Author)

Harvard University - Entrepreneurial Management Unit ( email )

Boston, MA 02163
United States

HOME PAGE: http://www.people.hbs.edu/rnanda

Tarun Khanna

Harvard University - Strategy Unit ( email )

Harvard Business School
Boston, MA 02163
United States
617-495-6038 (Phone)
617-495-0355 (Fax)

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