Immigrant self-employment in Sweden - its variation and some possible determinants

This paper examines self-employment among immigrants in Sweden. There are differences in the self-employment rate between immigrants and the native population and between different immigrant groups, both in the raw data and after controlling for variables such as age, gender, education and civil status. The study shows that non-Nordic immigrants in Sweden who arrived at an early date have higher self-employment rates than the native population. It seems as if self-employment among immigrants is to some extent positively correlated with time elapsed after arrival in the country. A number of possible explanations for the observed differences in self-employment between immigrants and natives and between different immigrant groups are presented in the study. Plausible explanations for the observed differences in self-employment rates are differences in traditions from the home country, differences in the labour market situation, and often a lack of knowledge among immigrants about the practical and formal matters an individual encounters when trying to establish a business.     

Self-employment of immigrants and natives in Sweden – a multilevel analysis

Recent research suggests that self-employment among immigrants is due to a combination of multiple situational, cultural and institutional factors, all acting together. Using multilevel regression and unique data on the entire population of Sweden for the year 2007, this study attempts to quantify the relative importance for the self-employed of embeddedness in ethnic contexts (country of birth) and regional business and public regulatory frameworks (labour market areas). This information indicates whether the layers under consideration are valid constructs of the surroundings that influence individual self-employment. The results show that 10% (women) and 8% (men) of the total variation in individual differences in self-employment can be attributed to the country of birth. When labour market areas are included in the analyses, the share of the total variation increases to 14% for women and 12% for men. The results show that the ethnic context and the economic environment play a minor role in understanding individual differences in self-employment levels. The results can have important implications when planning interventions or other actions focusing on self-employment as public measures to promote self-employment often are based on geographic areas and ethnic contexts.     

Ethnic group size,linguistic isolation,and immigrant entrepreneurship in the USA

Using a sample of immigrant men in US census data from the early and late 1900s and available in the Integrated Public Use Microdata Series (IPUMS), this study explores: (1) whether immigrant entrepreneurship is positively affected by ethnic group size and linguistic isolation; (2) how sensitive these relationships are to English-language proficiency; and (3) if these relationships have remained stable over time. The empirical results indicate that the size of the local ethnic population does not enhance immigrant self-employment for either English-proficient or limited-English-proficient (LEP) men in the USA. In addition, while linguistic isolation in the local labour pool seems to promote entrepreneurship among English-fluent immigrants in certain cases, it appears to hinder business formation among the LEP. Finally, comparing the results across time-periods is consistent with the premise that rising xenophobia pushes a disproportionate share of the LEP into self-employment.     

Cultural background,human capital and self-employment rates among immigrants in Norway

The level of self-employment varies significantly among immigrants from different countries of origin. The objective of this research is to examine the relationship between national culture, human capital in the form of educational attainment in the country of origin and self-employment rates among first-generation immigrants in Norway. Empirical secondary data on self-employment among immigrants from 53 countries residing in Norway in 2004 was used. Five different hypotheses were developed and tested using hierarchical regression analysis. The findings suggest that immigrants from countries with low power distance are more likely to become self-employed. However, other dimensions of cultural attributes, such as the home-country's uncertainty avoidance, masculinity/femininity and individualism/collectivism were not significantly associated with immigrants’ self-employment rate. Finally, and most notably, the average educational attainment in the country of origin was found to be significantly positively associated with self-employment among immigrants. The study concludes with practical implications and suggestions for future research.     

Self-employment policies and migrants' entrepreneurship in Germany

This paper presents results from a European project on policy and migrants' entrepreneurship in Germany. It develops a concept of biographical policy evaluation by analysing the extent to which the biographical processes that have led to self-employment among migrants in individual cases correspond to those anticipated by policy. The study identifies a biographical structure composed of two phases that shape the status passage to self-employment. During these phases, personal resources are mobilized and/or attempts are made to access policy support. Self-employment policies are fragmented in that they are designed to address specific stages of the process. Migrants are often excluded from policy participation, either as a result of policy failures or through a manner of implementation that is frequently influenced by prejudices and stereotypes. Deprived of class resources and sometimes unable to utilize ethnic resources, migrant would-be entrepreneurs require public support. The ‘bridging allowance’ scheme to encourage self-employment among the unemployed currently in place in Germany (Überbrückungsgeld) could serve as a model for a more adequate support policy for non-privileged business starters that would better allow for the participation of migrants.     

The labor market consequences of experience in self-employment

Many public policies are designed to encourage self-employment. However, because self-employment experiences are typically brief, it becomes important to understand the long-term consequences of entering and then leaving self-employment. Using the Panel Study of Income Dynamics (PSID), we examine the effects of brief self-employment experience on subsequent labor market outcomes. We find that, relative to continued wage employment, brief spells in self-employment do not increase—and probably actually reduce—average hourly earnings upon return to wage employment. We also find that those who experience self-employment have difficulty returning to the wage sector. However, these consequences are small compared to similar experiences in unemployment.     

Pushed out or pulled in? Self-employment among ethnic minorities in England and Wales

High rates of self-employment among ethnic minorities in England and Wales are investigated using a framework in which the self-employment decision is influenced by ethnic-specific attributes as well as sectoral earnings differentials. As expected, differences in an individual's predicted earnings in paid and self-employment are strongly correlated with self-employment decisions. Individuals with low English fluency, and recent immigrants, are less likely than other members of ethnic minorities to be self-employed. Perhaps surprisingly, this is also true of individuals living in “enclaves” — areas with a high percentage of their own ethnic group. The relatively deprived nature of such areas of England and Wales may explain this.     

Are self-employment training programs effective? Evidence from Project GATE

We examine the efficacy of providing self-employment training to unemployed and other individuals interested in self-employment using data from Project GATE. This experimental design program offered self-employment training services to a random sample of individuals who expressed a strong interest in self-employment. We find that Project GATE was effective in helping unemployed participants to start their own business, leading to significant impacts in self-employment and overall employment soon after program entry. The program also helped unemployed participants remain self-employed and avoid unemployment even five years after program entry. However, the program was not effective in improving the labor market outcomes of participants who were not unemployed.     

Transitions to and From Self-employment in Spain: An Empirical Analysis

This paper investigates the influence of individual characteristics and the business cycle on the probability of entry into self-employment and on self-employment duration. We estimate multinomial logit and discrete competing risks models using data from a longitudinal sample of Spanish men for the period 1985–1991. The results indicate that unemployment raises the probability of entering self-employment, but also increases the hazard of leaving self-employment, especially into unemployment. Moreover, receiving unemployment benefits significantly reduces the probability of entering self-employment. Liquidity constraints are important in determining enterpreneurial selection, but only for those who become self-employed with employees.     

The ‘recession-push’ hypothesis reconsidered

The relationship between unemployment and self-employment has been studied extensively. Due to its complex, multifaceted nature, various scholars have found a large array of different results, so that the exact nature of the relation is still not clear. An important element of the relation is captured by the recession-push hypothesis which states that in times of high unemployment individuals are pushed into self-employment for lack of alternative sources of income such as paid employment. We make two contributions to this literature. First, we argue that official unemployment rates may not capture the ??true?? rate of unemployment as it does not include ??hidden?? unemployed who are out of the labour force. Therefore, we propose a new method where the ??recession-push?? effect relates not only to the (official) unemployed but also to the inactive population. Second, we argue that the magnitude of the recession-push effect is non-linear in the business cycle, i.e. the effect is disproportionally stronger when economic circumstances are worse. We provide empirical support for our hypotheses by estimating an econometric model on Spanish data.     

Outcomes reported by students who participated in the 1994 Shell Technology Enterprise Programme

Policy-makers have supported initiatives that enhance the competitiveness of small and medium-sized enterprises (SMEs). They have also encouraged more students to seek jobs in SMEs. This study assessed the contribution of the 1994 Shell Technology Enterprise Programme (STEP), which subsidized the employment of students in SMEs in the UK. A key issue is whether STEP students participating in the programme reported significantly superior benefits than students who had never participated in the programme (i.e. non-STEP students). Outcomes associated with the programme were assessed over a 36-month period between 1994 and 1997. The programme had no significant impact on the ability students to have obtained full-time jobs. Similarly, the programme was not found to be significantly associated with the ability of graduates to have obtained full-time jobs in small private firms. Both STEP and non-STEP students reported in 1997 less positive attitudes towards self-employment or starting their own business. However, STEP students expressed a significantly more positive attitude than non-STEP students towards self-employment or starting their own business. Conclusions and implications for policy-makers and practitioners are detailed.     

May business mentors act as opportunity brokers and enablers among university students?

Networks are recognized as a central component of the entrepreneurial process, in particular with regard to opportunity identification and exploitation. In this study, we specifically analyze the role of mentors who are in business as opportunity brokers and enablers among university students with entrepreneurial intentions. Our investigation on 1022 students from 13 French-language universities based in Canada, France, Belgium and Algeria indicates that mentors in business, contrary to other mentors, support opportunity identification and exploitation among university students. Although student gender, entrepreneurial experience and education have a more pronounced effect, mentoring is the only element that can be controlled for through the creation of formal support programs. These results call on public authorities, and universities in particular, to implement formal mentoring programs to support students who are interested in starting their own business, and who would not otherwise have access to business mentors in their environment.     

A longitudinal study of habitual entrepreneurs: starters and acquirers

This study provides insights into the characteristics and behaviour of habitual starter entrepreneurs (i.e. individuals who have established more than one business) and habitual acquirer entrepreneurs (i.e. individuals who have purchased/acquired more than one business). A human capital perspective is utilized to illustrate that the human capital accumulated by a habitual entrepreneur may influence their subsequent behaviour. Prior business ownership experience is discussed in relation to an entrepreneur's human capital accumulation, as well as their search and business opportunity identification behaviour. A case study approach is used to develop propositions that highlight the similarities and differences between habitual starter and acquirer entrepreneurs. Implications for researchers and practitioners are discussed.     

The business case for equal opportunities

It has long been argued that equality of opportunity brings business benefits and that it is in employers' interest to implement policy to promote equality of opportunity. Our analysis of the Workplace Employment Relations Survey 2004 found neither large and widespread business benefits, nor large and widespread costs associated with Equal Opportunities policies amongst the establishments that implement these. Given the net benefits to society of equal opportunities policies, this suggests that public and private benefits are likely to differ substantially and points to the need for policy intervention.     

Determinants of agricultural entrepreneurship: a GEM data based study

The aim of this study is to explain the determinants of entrepreneurship in agriculture industry. What are the drivers of early stage entrepreneurial activity of agri-business entrepreneur and how it is influenced by various cognitive and social capital factors? To answers these questions various driving factors of entrepreneurial activity have been explored from the literature. To achieve the objective, the study uses APS (Adult Population Survey) 2013 data of 69 countries provided by GEM (Global Entrepreneurship Monitor). Total number of respondents 1470, those who are alone or with others, currently trying to start a new business, including any self-employment or selling any goods or services to others in Agriculture Industry, were selected from the data set. To measure the influence of cognitive and social capital factors on early stage entrepreneurial activity logistic regression was employed. The findings show that those who see entrepreneurial opportunities, are confident in their own skills and ability, having personal relationship or social networks with existing entrepreneurs, and have invested in others business as business angels are more likely to become an entrepreneur. Additionally, fear of failure or risk perception does not prevent people to become entrepreneur. Policy implications have been discussed. This is one the first study of its kind and contributes to the existing literature by explaining agricultural entrepreneurship through an integrated approach of entrepreneurial cognition and social networking.

     

With a little help from abroad: The effect of low-skilled immigration on the female labour supply

We examine whether and how the inflow of female immigrants who specialize in household production affects the labour supply of Italian women. To identify the causal effect, we exploit the family reunification motives and network effects (i.e., the tendency of newly arriving female immigrants to settle in places where males of the same country already live) which is used as an instrument for the geographical distribution of female foreign workers. We find that when the number of immigrants who provide household services is higher, native Italian women spend more time at work (intensive margin) without affecting their labour force participation (extensive margin). This impact is concentrated on highly skilled women whose time has a higher opportunity cost. These results also hold after a battery of robustness checks. We present some further evidence that is also consistent with the idea that the impact works through substitution in household work rather than complementarities in the production sector. Finally, we show that immigration arises as a substitute to publicly provided welfare services, although this phenomenon raises concerns regarding the fairness and sustainability of this private and informal welfare model.     

Small business financing sources between immigrants and natives in Puerto Rico

This paper analyzes the differences in small business financing sources among various groups in Puerto Rico (Island-born Puerto Ricans, Puerto Ricans born in the United States, and Immigrants). It is hypothesized that immigrants are relatively successful in obtaining funds from financial institutions because they are wealthier and might have a high representation in the financial sector, particularly in managerial positions, as compared to other groups. Also, immigrants could be positively self-selected into the entrepreneurial sector, therefore, financial institutions may attach a higher probability of business success to this group. The results from a multinomial logit model of financing sources support the contention that non-native owned businesses have a higher access to credit markets than natives owing perhaps, to their wealth status and economic power.JEL classification: G200; J150; M130; 0100     

Entrepreneurship and survival dynamics of immigrants to the U.S. and their descendants

Many studies have explored the determinants of entering into entrepreneurship and the differences in self-employment rates across racial and ethnic groups. However, very little is known about the survival in entrepreneurship of immigrants to the U.S. and their descendants.We adopt a modeling framework based on duration analysis, which takes into account both the fact that the stock of entrepreneurs initially observed represents a selected sample and the inability of observing in the data the exit time for some spells. Unlike previous studies, we find a lower survival probability in entrepreneurship for Mexican and other Hispanic immigrants, which does not carry on to their U.S.-born descendants. We also find that these two immigrant groups tend to enter entrepreneurship from unemployment or inactivity and they are more likely to exit towards employment in the wage sector, suggesting that entrepreneurship represents for them an intermediate step from non-employment to paid employment.     

Beyond Chinese,beyond food: unpacking the regulated Chinese restaurant business in Germany

Drawing upon findings from in-depth interviews with 22 Chinese restauranteurs, supplemented with communication with key informants and ethnographic observations, this paper illustrates the policy context in which the Chinese restaurant trade in Germany is embedded. Based on the typology from Esping-Andersen, characteristics of the German welfare state regimes are identified with special focus on their impact on immigration and migrants' employment options. This establishes the background for a closer examination of a selection of policies that govern, to different levels of success: (1) the migration of Chinese migrants, (2) the right of work for asylum seekers, (3) the level of authenticity of speciality restaurants, and (4) migrants' access of financial support and advice regarding self-employment. The paper shows how (migrant) entrepreneurs, facing changing levels of market challenges and policy controls, are active and creative agents in optimizing their performances. Strategies adopted include the modification of their business operations and range of products as well as tapping their resourceful ethnic social network for venture capital, necessary information and other forms of support.     

Self-employment and business cycle persistence: Does the composition of employment matter for economic recoveries?

Self-employment comprises an important share of employment in many countries, and tends to expand during downturns through higher inflows from unemployment. Furthermore, countries with higher self-employment shares exhibit lower cyclical output persistence. I build a business cycle model with frictional labor markets where individuals can be self-employed or salaried employed. I show that economies with larger self-employment shares exhibit faster economic recoveries. Differences in the ease of entry into self-employment as the economy recovers explain the contrasting cyclical dynamics. The model successfully captures the cyclical patterns of self-employment and the relationship between self-employment and output persistence in the data.