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==Economic outcomes==
==Economic outcomes==
Studies have produced mixed findings regarding the performance of immigrant-founded businesses relative to those founded by native-born entrepreneurs. Some research has found that immigrant-founded firms exhibit higher rates of employment growth over the medium term, alongside higher rates of both firm expansion and exit.  These patterns have been interpreted as reflecting greater dynamism as well as higher levels of risk.<ref name="Kerr2016"/>
Findings on the performance of immigrant-founded businesses are mixed. Some studies report higher rates of employment growth and firm dynamism, alongside higher rates of entry and exit.<ref name="Kerr2016"/> Other research finds no consistent advantage in long-term survival or payroll growth, suggesting outcomes vary by sector and firm type.<ref name="Kerr2016"/>
 
Other studies have found no consistent advantage in measures such as payroll growth or long-term firm survival, suggesting that outcomes vary across industries and firm types.<ref name="Kerr2016"/>
   
   
Immigrant-owned businesses have also been found to participate in international trade at higher rates than native-owned firms, a pattern associated with transnational networks, shared language, and knowledge of foreign markets.<ref name="Fairlie2015"/>
Immigrant-owned firms have been found to participate in international trade at higher rates than native-owned firms, a pattern associated with transnational ties and knowledge of foreign markets.<ref name="Fairlie2015"/> In high-technology sectors, research has identified higher levels of innovation among immigrant-founded firms.<ref name="Brown2019"/>
   
   
In high-technology sectors, research has identified higher rates of innovation among immigrant-owned firms across measures including product and process innovation, research and development activity, and patenting. These differences have been observed after controlling for demographic characteristics, financing, and industry composition.<ref name="Brown2019"/>
Outcomes also vary by skill level. Entrepreneurship may yield higher returns for highly skilled immigrants, while for others it may function primarily as an alternative to wage employment.<ref>{{cite journal |last=Lofstrom |first=Magnus |title=Low-Skilled Immigrant Entrepreneurship |journal=IZA Discussion Paper |number=4560 |year=2009 |url=https://docs.iza.org/dp4560.pdf}}</ref>
 
A 2025 study of approximately 91,000 United States start-ups reported that firms with both immigrant and native-born founders employed more people after three years, raised larger funding rounds, and filed more patents than firms founded by either group alone.<ref>{{cite web |title=For startup success, teams with both U.S.-born and immigrant founders have an edge |url=https://newsroom.haas.berkeley.edu/research/for-startup-success-teams-with-both-u-s-born-and-immigrant-founders-have-an-edge-study-shows/ |website=UC Berkeley Haas School of Business |date=23 September 2025 |access-date=21 March 2026}}</ref> The authors attributed these outcomes to complementary access to international talent, capital, and markets.
Outcomes also vary by skill level. Research has found that entrepreneurship may yield stronger economic returns for highly skilled immigrants, while for others it may function as an alternative to wage employment with more limited income growth.<ref>{{cite journal |last=Lofstrom |first=Magnus |title=Low-Skilled Immigrant Entrepreneurship |journal=IZA Discussion Paper |number=4560 |year=2009 |url=https://docs.iza.org/dp4560.pdf}}</ref> Some studies have also found that earnings among self-employed immigrants may converge toward those of native-born entrepreneurs over time, particularly with longer duration of residence.<ref name="Fairlie2015"/>


==See also==
==See also==

Revision as of 11:57, 28 May 2026

Template:Short description

Immigrant entrepreneurship refers to the founding or ownership of businesses by individuals who have migrated to a country other than their country of birth. It has been documented across a wide range of economies and historical periods, and is studied as a component of labour market integration, economic development, and innovation.

Research has found that immigrants in several countries, including the United States, United Kingdom, Canada, and Australia, establish businesses at higher rates than native-born populations.[1] Across OECD countries, migrant entrepreneurs account for a growing share of the self-employed population and have contributed to employment growth.[2] Scholars have identified several factors associated with immigrant entrepreneurship, including the role of co-ethnic networks, access to transnational resources, and barriers in conventional labour markets.[3]

Examples of immigrant entrepreneurs include Andrew Carnegie, a Scottish-born industrialist in the United States;[4] Jensen Huang, a Taiwan-born co-founder of NVIDIA;[5] Emilio Estefan, a Cuban-born music producer and record executive;[6] and Helena Rubinstein, born in what is now Poland, who established an international cosmetics business.[7]

Patterns and prevalence

Studies consistently find higher rates of business formation among immigrants in many developed economies.[1] Across OECD countries, the Organisation for Economic Co-operation and Development's International Migration Outlook 2024 reports that migrant entrepreneurs accounted for approximately 17% of the self-employed population in 2022, up from 11% in 2006, and contributed around 15% of employment growth between 2011 and 2021.[2]

In the United States, immigrants have represented a growing share of business owners and new founders over time, and have been estimated to start businesses at higher rates than the native-born population.[1][3] A 2024 report found that approximately 46% of Fortune 500 companies were founded by immigrants or their children.[8]

Patterns vary across countries and groups, reflecting differences in immigration policy, labour market conditions, and access to capital.[2]

Frameworks

Several theoretical frameworks have been developed to explain patterns of immigrant entrepreneurship. Ethnic enclave economy theory describes spatially concentrated clusters of co-ethnic businesses that provide employment and economic opportunity within immigrant communities.[9] Middleman minority theory describes entrepreneurs who occupy niche market positions serving as intermediaries between dominant and subordinate groups, often with limited ties to co-ethnic social structures.[10] Mixed embeddedness theory emphasises that immigrant entrepreneurs are shaped by both the resources of their ethnic community and the opportunity structures of the host-country economy, including labour markets, regulations, and access to capital.[11]

Contributing factors

Several factors have been identified as shaping immigrant entrepreneurship. The "blocked mobility" hypothesis proposes that barriers to employment, including non-recognition of foreign qualifications, language barriers, and labour market discrimination, may lead some immigrants to enter self-employment as an alternative pathway.[12] Co-ethnic networks and social capital can reduce barriers to business formation by providing access to labour, informal credit, and information.[10][13] Human capital, including education, skills, and prior business experience, contributes to variation in outcomes across immigrant groups.[3] Transnational connections allow entrepreneurs to access markets, labour, and knowledge across borders.[14]

Sectoral distribution

Immigrant entrepreneurship is distributed across a wide range of industries, with concentrations in both high-growth sectors, such as technology and finance, and in lower-barrier sectors including retail, personal services, and food service.[1][3]

In technology, immigrant founders have been associated with higher rates of innovation and are well represented among founders of venture capital-backed firms.[15] Notable examples include Sergey Brin, co-founder of Google; Steve Chen, co-founder of YouTube; and Jan Koum, co-founder of WhatsApp.[16] In media and entertainment, immigrant entrepreneurs were involved in founding major Hollywood studios and record labels, including Atlantic Records, co-founded by Istanbul-born Ahmet Ertegun.[1]

In retail, food service, and personal services, a substantial share of immigrant entrepreneurship occurs in sectors with relatively low barriers to entry, where self-employment may provide an alternative to wage labour.[14][3]

Diaspora and networks

Research has identified diaspora communities as an important context for immigrant entrepreneurship. Business formation within diasporas is often shaped by co-ethnic networks, pooled resources, shared language, and trust-based relationships.[10][11]

Patterns vary across groups and regions, reflecting differences in migration history, legal status, and access to resources.[2] Studies have documented how transnational and community-based networks support business development and facilitate participation in both local and international markets, with research spanning communities in East and Southeast Asia, the Americas, West Africa, and Europe.[14][10]

Economic outcomes

Findings on the performance of immigrant-founded businesses are mixed. Some studies report higher rates of employment growth and firm dynamism, alongside higher rates of entry and exit.[1] Other research finds no consistent advantage in long-term survival or payroll growth, suggesting outcomes vary by sector and firm type.[1]

Immigrant-owned firms have been found to participate in international trade at higher rates than native-owned firms, a pattern associated with transnational ties and knowledge of foreign markets.[3] In high-technology sectors, research has identified higher levels of innovation among immigrant-founded firms.[15]

Outcomes also vary by skill level. Entrepreneurship may yield higher returns for highly skilled immigrants, while for others it may function primarily as an alternative to wage employment.[17]

See also

References

  1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 Kerr, Sari Pekkala; Kerr, William R. (2016). "Immigrant Entrepreneurship". NBER Working Paper (17-011). https://www.hbs.edu/ris/Publication%20Files/17-011_da2c1cf4-a999-4159-ab95-457c783e3fff.pdf. 
  2. ↑ 2.0 2.1 2.2 2.3 "Migrant entrepreneurship in OECD countries: International Migration Outlook 2024". 2024-11-14. https://www.oecd.org/en/publications/international-migration-outlook-2024_50b0353e-en/full-report/migrant-entrepreneurship-in-oecd-countries_72f44494.html. 
  3. ↑ 3.0 3.1 3.2 3.3 3.4 3.5 Fairlie, Robert W.; Lofstrom, Magnus (2015). "Immigration and Entrepreneurship". Handbook of the Economics of International Migration. 1B. Elsevier. pp. 877-911. https://people.ucsc.edu/~rfairlie/papers/published/handbook%20chapter%20immigrant%20entrepreneurship%202015.pdf. 
  4. ↑ Gould, Sam (1995). "Andrew Carnegie: Scottish Immigrant, Entrepreneur, Philanthropist". University of Dayton Review 23 (3). https://ecommons.udayton.edu/udr/vol23/iss3/5. 
  5. ↑ Template:Cite encyclopedia
  6. ↑ Template:Cite encyclopedia
  7. ↑ Template:Cite encyclopedia
  8. ↑ "Fortune 500 Companies Founded by Immigrants [2024"]. 2025-11-12. https://www.americanimmigrationcouncil.org/report/new-american-fortune-500-2024/. 
  9. ↑ Light, Ivan; Sabagh, Georges; Bozorgmehr, Mehdi; Der-Martirosian, Claudia (1994). "Beyond the Ethnic Enclave Economy". Social Problems 41 (1): 65-80. doi:10.2307/3096842. 
  10. ↑ 10.0 10.1 10.2 10.3 Cite error: Invalid <ref> tag; no text was provided for refs named MinBozorgmehr2000
  11. ↑ 11.0 11.1 Cite error: Invalid <ref> tag; no text was provided for refs named Salehi2026
  12. ↑ Raijman, Rebeca; Tienda, Marta (2000). "Immigrants' Pathways to Business Ownership: A Comparative Ethnic Perspective". International Migration Review 34 (3): 682. doi:10.2307/2675941. https://www.jstor.org/stable/2675941?origin=crossref. Retrieved on 2026-05-17. 
  13. ↑ Martén, Linna; Hainmueller, Jens; Hangartner, Dominik (2019). "Ethnic networks can foster the economic integration of refugees". Proceedings of the National Academy of Sciences 116 (33): 16280–16285. doi:10.1073/pnas.1820345116. 
  14. ↑ 14.0 14.1 14.2 Eckstein, Susan; Peri, Giovanni (2018). "Immigrant Niches and Immigrant Networks in the U.S. Labor Market". RSF: The Russell Sage Foundation Journal of the Social Sciences 4 (1): 1–17. doi:10.7758/RSF.2018.4.1.01. ISSN 2377-8253. http://www.rsfjournal.org/lookup/doi/10.7758/RSF.2018.4.1.01. Retrieved on 2026-05-17. 
  15. ↑ 15.0 15.1 Template:Cite report
  16. ↑ Greenstein, Shane M. (2015-12-21). "Without Immigrants, We Wouldn't Have Google". https://www.library.hbs.edu/working-knowledge/without-immigrants-we-wouldn-t-have-google. 
  17. ↑ Lofstrom, Magnus (2009). "Low-Skilled Immigrant Entrepreneurship". IZA Discussion Paper (4560). https://docs.iza.org/dp4560.pdf. 
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