Research surveying the impact of immigration on entrepreneurship finds that immigrants turning to entrepreneurship are mostly not entrepreneurs in their country of origin. “The US is sometimes blamed for ‘stealing’ entrepreneurs from other countries. But this is not necessarily the case. The study has found that successful immigrant entrepreneurs mostly became that way to overcome exclusion and other obstacles,” says Prof. Yaron Zelekha of Ono Academic College.

Immigrants turning to entrepreneurship in their new country were not necessarily entrepreneur-oriented while living in their home country, reveals a new study examining the impact of immigration on entrepreneurship. The results of the study, soon to be published in the International Review for Social Sciences Kyklos, suggest that discriminatory hiring practices in a host country – and not personal characteristics – are the impetus for immigrants to establish new businesses. The study, conducted by Prof. Yaron Zelekha, Dean of the Faculty of Business Administration at Ono Academic College and formerly Israel’s Accountant-General, set out to examine whether immigration has an impact on entrepreneurship.

It used a uniquely designed data collection formula based on information available from LinkedIn. “This online professional networking resource is targeted to executives of various organizations in approximately 200 countries,” Zelekha explains. “LinkedIn presents a ‘survey’ of over 120 million members and almost the entire population of entrepreneurs. It is continuously updated by its users and can give ‘real-time’ results.” As such, this provided the current study with an extensive and detailed database of entrepreneur development over time by country, by field, and by professional level. Data sets from United Nations reports and from other social media networks that served as control groups completed the background data necessary to conduct the study. The researcher’s working definition of entrepreneurship was the “creation of a new venture in the mid- and high-technology sectors”.

A high yearly flow of immigrants and rise in entrepreneurship indicated a direct and positive relationship between the two. However, an assumption that the personal characteristics of emigrants would be similar to immigrants’ characteristics does not naturally place immigrants in the world of innovation and entrepreneurship. This led the study to conclude that while these emigrants were not entrepreneur-oriented while living in their home country, they were driven toward entrepreneurship in the new hosting country; and this strongly suggests that it is the discriminatory hiring practices of a host country and not personal characteristics that leads them to engage in entrepreneurial activity.

“This is contrary to claims often made by countries whose emigrants become successful entrepreneurs in their new countries,” says Zelekha. “The US and other countries are sometimes blamed for ‘stealing’ entrepreneurs from other countries. But this new study suggests this is not necessarily the case. We found that successful immigrant entrepreneurs mostly became that way to overcome exclusion and other obstacles,” he explains.

The study has also found that the presence of an immigrant community in country has a positive impact on entrepreneur growth in that country, as does an open and competitive economy, a larger urban population, ethno-cultural diversity, and spoken English or another major language in the country. Another interesting observation is that the more women are involved in a country’s economy (indicating an open-minded culture) the higher the level of immigrant entrepreneurship.

“Overall, this study has shown that immigration positively impacts entrepreneurship and that it is the environment in the host country that influences that. Besides the implications that these results have on how a country can enhance and optimize immigrant entrepreneurship, the results also show that given the right surroundings and impetus, anyone could become an entrepreneur,” says Zelekha.

(YWN – Israel Desk, Jerusalem)