Opportunity recognition in immigrant entrepreneurship through social capital and geographical proximity: A conceptual framework
Abstract
The purpose of this paper is to present a conceptual framework of the role of social capital as an ultimate resource for immigrant entrepreneurs in recognising entrepreneurial opportunities. Research consistently reveals that immigrants have higher tendency to engage in entrepreneurial activities in countries where they reside. Based on a review of existing literature, resources such as human, social, and financial capital facilitate immigrants to pursue entrepreneurial activities. In recognising business opportunities, social contexts have immensely influenced the entrepreneurial process. However, the role of social capital as an ultimate resource for immigrant entrepreneurship have yet to be comprehensively understood. Social capital is significantly related to the information flows, the trust and norms between individuals. Additionally, the geographical proximity between immigrants and their co-ethnic groups and local communities which enable more rigorous social exchanges plays prevalence role for immigrants to pursue entrepreneurial activities. Therefore, we could argue that the social capital and immigrant entrepreneurs’ geographical proximity are crucial constructs for immigrant entrepreneurs to recognise opportunities for their business ventures in a host country. The review of past literature enables us to develop a conceptual framework on how social capital and geographical proximity may assist the opportunity recognition of immigrant entrepreneurs. The proposed conceptual framework offers three general propositions than can be empirically validated in future research. This paper contributes to enhance the understanding of immigrant entrepreneurship from the lens of opportunity recognition, social capital and geographical proximity.
Keywords: conceptual framework, host country, immigrant entrepreneurship, opportunity recognition, geographical proximity, social capital
Full Text:
PDFReferences
Adler, P.S., & Kwon, S.W. (2002). Social capital: Prospects for a new concept. Academy of Management Review, 27(1), 17-40.
Aldrich, H.E., & Zimmer, C. (1986). Entrepreneurship through social networks. California Management Review.
Aldrich, H.E., & Waldinger, R. (1990). Ethnicity and entrepreneurship. Annual Review of Sociology, 16(1), 111-135.
Aliaga-Isla, R., & Rialp, A. (2013). Systematic review of immigrant entrepreneurship literature: Previous findings and ways forward. Entrepreneurship and Regional Development, 25(9-10), 819-844.
Alsos, G.A., & Kaikkonen, V. (2004). Opportunities and prior knowledge: A study of experienced entrepreneurs. Frontiers of Entrepreneurship Research, (March), 301-314.
Anderson, B., & Blinder, S. (2015). Who counts as a migrant? Definitions and their consequences. Migration Observatory Briefing, COMPAS (Vol. 4). UK.
Ardichvili, A., & Cardozo, R.N. (2000). A model of the entrepreneurial opportunity recognition process. Journal of Enterprising Culture, 8(2), 103-119.
Ardichvili, A., Cardozo, R., & Ray, S. (2003). A theory of entrepreneurial opportunity identification and development. Journal of Business Venturing, 18(1), 105-123.
Arenius, P., & De Clercq, D. (2005). A network-based approach on opportunity recognition. Small Business Economics, 24(3), 249-265.
Barrett, C.B., Reardon, T., & Webb, P. (2001). Nonfarm income diversification and household livelihood strategies in rural Africa: Concepts, dynamics, and policy implications. Food Policy, 26, 315-331.
Barrett, R., & Vershinina, N. (2017). Intersectionality of ethnic and entrepreneurial identities: A study of post-war Polish entrepreneurs in an English city. Journal of Small Business Management, 55(3), 430-443.
Bates, T. (1997). Financing small business creation: The case of Chinese and Korean immigrant entrrepreneurs. Journal of Business Venturing, 12(2), 109-124.
Bates, T. (1999). Existing self-employment: An analysis of Asian immigrant-owned small businesses. Small Business Economics, 13, 171-183.
Bird, M., & Wennberg, K. (2016). Why family matters: The impact of family resources on immigrant entrepreneurs' exit from entrepreneurship. Journal of Business Venturing, 31(6), 687-704.
Borjas, G. (1986). The earnings of state government employees in the United States. Journal of Urban Economics, 19, 156-173.
Boyd, M. (1989). Family and personal networks in international migration: Recent developments and new agendas. International Migration Review.
Brockman, B. K. (2014). Entrepreneurial alertness in opportunity identification and opportunity development. Journal of Business & Entrepreneurship, 26(2), 27-44.
Chavan, M., & Taksa, L. (2017). Shifts in intergenerational mobility of Indian immigrant entrepreneurs. International Migration, 55(1), 99-127.
Coleman, J.S. (1988). Social capital in the creation of human capital. American Journal of Sociology, 94, 95-120.
Cooper, A.C. (1993). Challenges in predicting new firm performance. Journal of Business Venturing, 8, 241-253.
Crockett, D.R. (2013). Immigrant entrepreneurs' selectivity: Host market distance and opportunity. Journal of Enterprising Communities: People and Places in the Global Economy, 7(3), 196-212.
Dana, L.P., Gurau, C., Light, I., & Muhammad, N. (2020). Family, community, and ethnic capital as entrepreneurial resources: Toward an integrated model. Journal of Small Business Management, 1-27.
De Clercq, D., Lim, D.S., & Oh, C.H. (2013). Individual–level resources and new business activity: The contingent role of institutional context. Entrepreneurship Theory and Practice, 37(2), 303-330.
De Koning, A.J., & Muzyka, D.F. (1999). Conceptualizing opportunity recognition as a socio-cognitive process. SSE/EFI Working Paper Series in Business Administration, 1-26. Retrieved from http://swoba.hhs.se/hastba/papers/hastba1999_013.pdf
Dheer, R.J.S. (2018). Entrepreneurship by immigrants: A review of existing literature and directions for future research. International Entrepreneurship and Management Journal, 1-60.
Dheer, R.J.S., & Lenartowicz, T. (2018). Career decisions of immigrants: Role of identity and social embeddedness. Human Resource Management Review, 28(2), 144-163.
Dimov, D. (2007). “From opportunity insight to opportunity intention: The importance of personsituation learning match”. Entrepreneurship Theory and Practice, 31(4), 561-583.
Engelen, E. (2002). How innovative are Dutch immigrant entrepreneurs? Constructing a framework of assessment. International Journal of Entrepreneurial Behavior & Research, 8(1/2), 69-92.
Fairlie, R.W., & Meyer, B.D. (1996). Ethnic and racial self-employment differences and possible explanations. The Journal of Human Resources, 31(4), 757-793.
Fairlie, R.W., & Lofstrom, M. (2015). Immigration and entrepreneurship. In Chiswick, B.R. & Miller, P.W. (Eds.), Handbook of the Economics of International Migration 1 (pp. 877-911). North-Holland: Elsvier.
Feldman, H.D., Koberg, C.S., & Dean, T.J (1991). Minority small business owners and their paths to ownership. Journal of Small Business Management, 29(4),12-27.
Fiet, J.O. (2002). The systematic search for entrepreneurial discoveries. ABC-CLIO.
Griffin‐el, E.W., & Olabisi, J. (2018). Breaking boundaries: Exploring the process of intersective market activity of immigrant entrepreneurship in the context of high economic inequality. Journal of Management Studies, 55(3), 457-485.
Guercini, S., Milanesi, M., & Dei Ottati, G. (2017). Paths of evolution for the Chinese migrant entrepreneurship: A multiple case analysis in Italy. Journal of International Entrepreneurship, 15(3), 266-294.
Herander, M.G., & Saavedra, L.A. (2005). Exports and the structure of immigrant-based networks: The role of geographic proximity. Review of Economics and Statistics, 87(2), 323-335.
Johannisson, B. (1990). Community entrepreneurship-cases and conceptualization. Entrepreneurship and Regional Development, 2(1), 71-88.
Kalnins, A., & Chung, W. (2001). Ethnic links, location choice and performance: A test of the rural motel industry. Multiunit Organization and Multimarket Strategy, 18, 1-28.
Kalnins, A., & Chung, W. (2006). Social capital, geography, and survival: Gujarati immigrant entrepreneurs in the U.S. lodging industry. Management Science, 52(2), 233-247.
Kirzner, I. (1978). The entrepreneurial role in Menger’s system. Atlantic Economic Journal, 6(3), 31-45.
Kirzner, I. (1997). Entrepreneurial discovery and the competitive market process: An Austrian approach. Journal of Economic Literature, 60-85.
Kloosterman, R., & Van Der Leun, J. (1999). Just for starters: Commercial gentrification by immigrant entrepreneurs in Amsterdam and Rotterdam neighborhoods. Housing Studies, 14(5), 659-677.
Kloosterman, R., Van der Leun, J., & Rath, J. (1998). Across the border: Immigrants’ economic opportunities, social capital and informal business activities. Journal of Ethnic and Migration Studies, 24(2), 249-268.
Kuckertz, A., Kollmann, T., Krell, P., & Stöckmann, C. (2017). Understanding, differentiating, and measuring opportunity recognition and opportunity exploitation. International Journal of Entrepreneurial Behavior and Research, 23(1), 78-97.
Li, P.S. (2004). Social capital and economic outcomes for immigrants and ethnic minorities. Journal of International Migration and Integration, 5(2), 171-190.
Lincoln, J.R., Gerlach, M.L., & Ahmadjian, C.L. (1996). Keiretsu networks and corporate performance in Japan. American Sociological Review, 61(1), 67-88.
Mainela, T., Puhakka, V., & Servais, P. (2014). The concept of international opportunity in international entrepreneurship: A review and a research agenda. International Journal of Management Reviews, 16, 105–129.
Mas-Verdú, F., Ribeiro-Soriano, D., & Roig-Tierno, N. (2015). Firm survival: The role of incubators and business characteristics. Journal of Business Research, 68(4), 793-796.
Nahapiet, J., & Ghoshal, S. (1998). Social capital, intellectual capital, and the organizational advantage. Academy of Management Review, 23(2), 119–157.
Nakhaie, R., Lin, X., & Guan, J. (2009). Social capital and the myth of minority self-employment: Evidence from Canada. Journal of Ethnic and Migration Studies, 35(4), 625-644.
Nazareno, J., Zhou, M., & You, T. (2018). Global dynamics of immigrant entrepreneurship. International Journal of Entrepreneurial Behavior & Research.
Ndofor, H.A., & Priem, R. L. (2011). Immigrant entrepreneurs, the ethnic enclave strategy, and venture performance. Journal of Management, 37(3), 790-818.
Nee, V., & Sanders, J. (2001). Understanding the diversity of immigrant incorporation: A forms of capital model. Ethnic and Racial Studies, 24(3), 386-411.
Ozgen, E., & Baron, R.A. (2007). Social sources of information in opportunity recognition: Effects of mentors, industry networks, and professional forums. Journal of Business Venturing, 22, 174-192.
Perera, B.Y., Gomez, C., Weisinger, J.Y., & Tobey, D.H. (2013). The role of social capital in the growth and innovation of immigrant-founded enterprises. International Journal of Innovation and Learning, 13(1), 33-49.
Philips, N., & Tracey, P. (2007). Opportunity recognition, entrepreneurial capabilities and bricolage: Connecting institutional theory and entrepreneurship in strategic organization. Strategic Organization, 5(3), 313-320.
Portes, A., & Sensenbrenner, J. (1993). Embeddedness and immigration : Notes on the social determinants of economic action. American Journal of Sociology, 98(6), 1320-1350.
Prashantham, S. (2006). Foreign network relationships and the internationalisation of small knowledge-intensive firms. International Journal Entrepreneurship and Innovation Management, 6(6), 542–553.
Rahman, M.M. (2018). Development of Bangladeshi immigrant entrepreneurship in Canada. Asian and Pacific Migration Journal, 27(4), 404-430.
Rahmandoust, M., Ahmadian, S., & Shah, I.M. (2011). Iranian entrepreneurs in Malaysia : Reasons for their migration. World Applied Sciences Journal, 13(9), 2075-2081.
Ram, M., Theodorakopoulos, N., & Jones, T. (2008). Forms of capital, mixed embeddedness and Somali enterprise. Work, Employment and Society, 22(3), 427-446.
Robertson, D.W., & Grant, P.R. (2016). Immigrant entrepreneurship from a social psychological perspective. Journal of Applied Social Psychology, 46(7), 394-409.
Sahasranamam, S., & Nandakumar, M.K. (2020). Individual capital and social entrepreneurship: Role of formal institutions. Journal of Business Research, 107, 104-117.
Sanders, J. M., & Nee, V. (1996). Immigrant self-employment : The family as social capital and the value of human capital. American Sociological Review, 61(2), 231-249.
Sasse, G., & Thielemann, E. (2005). A research agenda for the study of migrants and minorities in Europe. Journal of Common Market Studies, 43(4), 655-671.
Schumpeter, J.A., (1934). The theory of economic development. An inquiry into profits, capital, credit, interest, and the business cycle. Transaction Publishers.
Shane, S. (2000). Prior knowledge and the discovery of entrepreneurial opportunities. Management Science, 47(2), 205-220.
Shane, S. (2003). A general theory of entrepreneurship: The individual-opportunity nexus. Edward Elgar Publishing.
Shane, S., & Venkataraman, S. (2000). The promise of entrepreneurship as a field of research. Academy of Management Review 25(1), 217-226.
Shinnar, R.S., & Nayır, Z.D. (2019). Immigrant entrepreneurship in an emerging economy: The case of Turkey. Journal of Small Business Management, 57(2), 559-575.
Singh, R.P., Hills, G.E., Lumpkin, G.T., & Hybels, R.C. (1999). The entrepreneurial opportunity recognition process: Examining the role of self-perceived alertness and social networks. Academy of Management Proceedings, (1), 1-6.
Tata, J., & Prasad, S. (2008). Social capital, collaborative exchange and microenterprise performance : The role of gender. International Journal of Entrepreneurship and Small Business, 5(3/4), 373–388.
Tata, J., & Prasad, S. (2015). Immigrant family businesses: Social capital, network benefits and business performance. International Journal of Entrepreneurial Behavior and Research, 12(6), 842-866.
The Economist. (2012). Immigrant entrepreneurs: The Chilecon Valley challenge. Retrieved from http:// www.economist.com/node/21564564
The Wall Street Journal. (2016a). Immigration Does More Good Than Harm to Economy, Study Finds. Retrieved from https://www.wsj.com/articles/immigration-does-more-good-than-harm-to-economy-study-finds-1474568991
The Wall Street Journal. (2016b). Trump’s immigration policy protested in New York. Retrieved from http://www.wsj.com/articles/trumps-immigration-policy-protested-in-new-york-1479073697
Tienda, M., & Raijman, R. (2004). Promoting Hispanic immigrant entrepreneurship in Chicago. Journal of Developmental Entrepreneurship, 9(1), 1–21.
United Nations. (2015). International migration report. Retrieved from https://www.un.org/en/development/desa/population/migration/publications/migrationreport/docs/MigrationReport2015_Highlights.pdf
United Nations. (2017). International migration report. Retrieved from https://www.un.org/en/development/desa/population/migration/publications/migrationreport/docs/MigrationReport2017_Highlights.pdf
Van Tubergen, F. (2005). Self-employment of immigrants: A cross-national study of 17 Western societies. Social Forces, 84(2), 709–732.
Vandor, P., & Franke, N. (2016). Why are immigrants more entrepreneurial? Harvard Business Review. Retrieved from https://hbr.org/2016/10/why-are-immigrants-more-entrepreneurial
Villena, V.H., Revilla, E., & Choi, T.Y. (2011). The dark side of buyer-supplier relationships: A social capital perspective. Journal of Operations Management, 29(6), 561-576.
Vinogradov, E., & Jørgensen, E.J.B. (2017). Differences in international opportunity identification between native and immigrant entrepreneurs. Journal of International Entrepreneurship, 15(2), 207-228.
Vries, H.P., Hamilton, R.T., & Voges, K. (2015). Antecedents of ethnic minority entrepreneurship in New Zealand: An intergroup comparison. Journal of Small Business Management, 53(sup1), 95-114.
Wadhwa, V., Saxenian, A., Rissing, B.A., & Gereffi, G. (2007). America's new immigrant entrepreneurs: Part I. Duke Science, Technology & Innovation Paper(23).
Wang, Y., & Warn, J. (2018). Chinese immigrant entrepreneurship: Embeddedness and the interaction of resources with the wider social and economic context. International Small Business Journal: Researching Entrepreneurship, 36(2), 131-148.
Yanai, L., Che Senik, Z., Muhamad, N.S., Abd Hamid, H., & Jamaludin, N.A. (2020). Push and pull factors influencing Thai immigrant entrepreneurs conducting business in Malaysia. Journal of Nusantara Studies (JONUS), 5(2), 19-47.
Zubair, M., & Brzozowski, J. (2018). Entrepreneurs from recent migrant communities and their business sustainability. Sociologica, 12(2), 57-72.
Refbacks
- There are currently no refbacks.