Empresarios e inmigración. Evidencia de Massachusetts y de EE.UU.

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Ciclo de Conferencias: Reacting to the crisis: the new regulatory environment. En colaboración con el Instituto de Empresa.
Julio De Castro
Babson College. Massachusetts. EE.UU.
Madrid, 1 de abril de 2011

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Empresarios e inmigración. Evidencia de Massachusetts y de EE.UU.

  1. 1. Immigrant Entrepreneurship in the United States and Massachusetts: data and evidence Julio O. De Castro Lewis Family distinguished professor of global management Babson College
  2. 2. Why study immigration? <ul><ul><li>For research </li></ul></ul><ul><ul><ul><li>Under researched area </li></ul></ul></ul><ul><ul><ul><li>Important area of understanding for business </li></ul></ul></ul><ul><ul><li>Personally </li></ul></ul><ul><ul><ul><li>Fits with my research interest on examining the breadth of entrepreneurial behavior </li></ul></ul></ul><ul><ul><ul><ul><li>Entrepreneurship in family, micro enterprises and gender </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Entrepreneurship and product piracy </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Entrepreneurship and informal businesses: characteristics of informal businesses that become growth ventures </li></ul></ul></ul></ul>
  3. 3. Finally, <ul><ul><li>Immigration: a key global societal conversation. </li></ul></ul><ul><ul><ul><li>For those seeking the benefits of immigration </li></ul></ul></ul><ul><ul><ul><ul><li>Germany discusses opening the immigration process for immigrants with professional degrees </li></ul></ul></ul></ul><ul><ul><ul><li>For those discussing the costs of immigration, mostly to the societies that they migrate too. </li></ul></ul></ul>
  4. 4. Surprisingly: <ul><ul><li>Very little research on the business implications of immigration </li></ul></ul><ul><ul><ul><li>Unanticipated, given the preponderance of US based research in social sciences and that the US defines itself as a country of Immigrants </li></ul></ul></ul><ul><ul><ul><ul><li>Some research on economic impact of immigration, (Hill, 1971; Borjas, 1990-99; Lalonde, 1997; Chiswick,2005) </li></ul></ul></ul></ul><ul><ul><ul><ul><li>And a wealth of sociology research on immigration and its effects (e.g. Portes et al) </li></ul></ul></ul></ul><ul><ul><ul><li>But very little research on the entrepreneurial and business aspects of immigrants and immigration </li></ul></ul></ul>
  5. 5. In management research: <ul><li>Concentration on the examination of the impact of executive migration </li></ul><ul><ul><li>Expatriate work (e.g. Stewart, Black, etc) </li></ul></ul><ul><ul><li>Influence of migration on executive labor markets (e.g. Hill) </li></ul></ul>
  6. 6. In entrepreneurship research: <ul><ul><ul><li>Research in immigrant impact on the variation of entrepreneurial rates (Shane, 1996) </li></ul></ul></ul><ul><ul><ul><li>Research on transnational entrepreneurship (again, our impulse as researchers to rename everything ). ETP special issue (Sequeira et al , 2005; Chen and Tan, 2005; Drori, Honing and Wight, 2005) </li></ul></ul></ul><ul><ul><ul><ul><li>First approximation to the systematic examination of characteristics of immigrant entrepreneurs </li></ul></ul></ul></ul><ul><ul><ul><li>Characteristics of immigrant entrepreneurship in different countries: </li></ul></ul></ul><ul><ul><ul><ul><li>Stone and Stubbs (2007), the Netherlands, Levie (2007), the UK, Light and Israelowitz (2005) Israel and the US </li></ul></ul></ul></ul><ul><li>Thus a lack of research on the characteristics of entrepreneurship in immigrant populations </li></ul>
  7. 7. Today <ul><ul><ul><li>Given the value laden discussions around immigration, we wanted to provide a look at the data with regards to entrepreneurial behavior of immigrants in the US and Massachusetts </li></ul></ul></ul><ul><ul><ul><li>Why Massachusetts </li></ul></ul></ul><ul><ul><ul><ul><ul><li>Grant money </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>No, seriously, wanted to understand the entrepreneurial behavior of immigrants in the state given its knowledge based economy </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>60+ universities </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Untold research centers </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Medical and biomedical powerhouse </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Route 128 software and technology (the east equivalent of silicon valley) </li></ul></ul></ul></ul></ul>
  8. 8. data and evidence <ul><ul><li>Data comes from the G lobal E ntrepreneurship M onitor ( GEM ) for Massachusetts and the USA </li></ul></ul><ul><ul><li>What is GEM ? </li></ul></ul><ul><ul><ul><li>GEM is a 54 country harmonized research project that generates original data on the institutional framework for entrepreneurship and entrepreneurial attitudes, activity and aspirations </li></ul></ul></ul>
  9. 9. GEM focuses on three main objectives : <ul><ul><ul><ul><li>To measure differences in the level of entrepreneurial activity among countries  </li></ul></ul></ul></ul><ul><ul><ul><ul><li>To uncover factors determining national levels of entrepreneurial activity </li></ul></ul></ul></ul><ul><ul><ul><ul><li>To identify policies that may enhance the national level of entrepreneurial activity </li></ul></ul></ul></ul><ul><ul><li>Gem is also used to examine within country groups (e.g. Immigrants) </li></ul></ul><ul><ul><ul><ul><li>Within GEM USA Adult Population Survey (APS) (4500+ interviews), we collected data for the state of Massachusetts (1000 interviews) </li></ul></ul></ul></ul>
  10. 10. Key gem definitions <ul><li>Total early-stage entrepreneurial activity (TEA Rate) </li></ul><ul><ul><li>As its name implies, total early-stage entrepreneurial activity refers to the total rate of early-stage entrepreneurial activity among the adult population. Includes nascent and new firm entrepreneurs. </li></ul></ul><ul><li>Nascent entrepreneur </li></ul><ul><ul><li>A nascent entrepreneur is one who is actively planning a new venture. Such an entrepreneur has done something during the previous 12 months to help start a new business that he or she will own, at least in part. </li></ul></ul><ul><li>New firm entrepreneur </li></ul><ul><ul><li>A new firm entrepreneur is an entrepreneur who, at least in part, owns and manages a new business that is between four and 42 months old and has not paid salaries for longer than this period. </li></ul></ul><ul><li>Business discontinuation rate </li></ul><ul><ul><li>Percentage of the 18-99 age group who have, in the past 12 months, discontinued a business, either by selling, shutting down or otherwise discontinuing an owner-management relationship with the business. </li></ul></ul><ul><li>Established business owner </li></ul><ul><ul><li>is an entrepreneur who has set up businesses that they continue to own and manage and who have paid wages or salaries for more than 42 months. </li></ul></ul>
  11. 11. Three comparisons: <ul><li>US immigrants vs non immigrants </li></ul><ul><li>Mass Immigrants vs non immigrants </li></ul><ul><li>Mass Immigrants vs US immigrants </li></ul>
  12. 12. USA immigration data 2009/2010   2009 US 2009 US 2010 US 2010 US   Immigrant Non-Immigrant Immigrant Non-Immigrant   n=312 n =4,588 n=306 n=3632 Opportunity 64.5% 70.1% 40.0% 72.2% Necessity 19.4% 23.1% 60.0% 27.8% TEA 9.9% 6.7% 5.9% 6.1% Nascent entrepreneur 5.5% 4.2% 4.6% 3.8% New firm entrepreneur 4.5% 2.6% 1.0% 2.4% Established 6.7% 5.7% 7.2% 7.5% Closing 1.6% 1.0% 0.3% 1.2%
  13. 13. Entrepreneurial Climate   2009 US 2009 US 2010 US 2010 US   Immigrant Non-Immigrant Immigrant Non-Immigrant Opportunity startups 6 months 35.3% 29.2% 37.8% 32.3% Business good career choice 67.5% 65.8% 68.1% 64.4% Success bus leads to status 74.4% 75.4% 72.7% 76.9% Media coverage of new bus 76.4% 67.3% 68.2% 68.1%
  14. 14. Age and gender   2009 US 2009 US 2010 US 2010 US   gender Immigrant Non-Immigrant Immigrant Non-Immigrant Female 57.7% 51.0% 50.7% 52.0% Male 42.3% 49.0% 49.3% 48.0%
  15. 15. With age, an interesting phenomenon has been occurring in the us in terms of entrepreneurship activity
  16. 16. 62.5% 52% 57.85 57.6%   2009 US 2009 US 2010 US 2010 US   age Immigrant Non-Immigrant Immigrant Non-Immigrant 18-24 9.3% 13.3% 12.4% 11.1% 25-34 25.3% 17.3% 19.6% 15.7% 35-44 27.9% 17.4% 25.8% 15.6% 45-54 18.3% 19.3% 20.6% 17.5% 55-64 9.9% 15.4% 10.8% 13.8% 65-98 9.3% 17.3% 10.8% 26.3%
  17. 17. Funding Small n=4   2009 US 2009 US 2010 US 2010 US   Immigrant Non-Immigrant Immigrant Non-Immigrant Funding     Total money invested     0-$10,000 29.0% 32.8% 25.0% 72.6% $10,000 to $50,000 22.6% 20.9% 25.0% 9.7% $50,001 to $500,000 25.8% 19.6% 50.0% 16.1% $500,001 to $5,000,000 3.2% 2.6% 0.0% 0.0% $5,000,001 to highest 19.4% 24.3% 0.0% 1.6%
  18. 18. Social Entrepreneurship   2009 US 2009 US 2010 US 2010 US   Immigrant Non-Immigrant Immigrant Non-Immigrant Social Entrepreneurship     New firm entrepreneur     For-profit economic goals 33.3% 40.0% 53.8% 38.9% For-profit social goals 13.3% 11.0% 7.7% 7.4% For-profit equal economic/social 53.3% 41.0% 38.5% 46.3% Non-profit 0.0% 7.0% 0.0% 6.2% Established     For-profit economic goals 60.0% 60.0% 58.3% 57.2% For-profit social goals 0.0% 5.4% 4.2% 7.5% For-profit equal economic/social 36.0% 25.4% 33.3% 30.8% Non-profit 0.0% 3.4% 4.2% 3.6%
  19. 19. Massachusetts immigration data 2008/2010   2008 MA 2008 MA 2010 MA 2010 MA   Immigrant Non-Immigrant Immigrant Non-Immigrant   n=62 n=529 n=90 n=885 Opportunity 71.4% 88.4% 77.8% 74.5% Necessity 28.6% 11.6% 22.2% 25.5% TEA 12.7% 8.1% 10.0% 6.2% Nascent entrepreneur 11.1% 4.0% 7.8% 4.2% New firm entrepreneur 1.6% 4.3% 2.2% 2.1% Established 6.3% 9.1% 1.1% 6.7% Closing 0.0% 1.1% 2.2% 0.9%
  20. 20. Entrepreneurial Climate   2008 MA 2008 MA 2010 MA 2010 MA   Immigrant Non-Immigrant Immigrant Non-Immigrant Opportunity startups 6 months 30.8% 33.3% 36.8% 32.8% Business good career choice 64.1% 56.0% 61.4% 65.6% Success bus leads to status 79.5% 72.6% 70.0% 77.9% Media coverage of new bus 73.7% 79.5% 80.2% 72.4%
  21. 21. Age and gender 55.5% 60% 64.4% 55.3%   2008 MA 2008 MA 2010 MA 2010 MA   gender Immigrant Non-Immigrant Immigrant Non-Immigrant Female 46.8% 49.5% 48.9% 50.1% Male 53.2% 50.5% 51.1% 49.9%   2008 MA 2008 MA 2010 MA 2010 MA   age Immigrant Non-Immigrant Immigrant Non-Immigrant 18-24 15.9% 12.8% 13.3% 8.3% 25-34 19.0% 10.4% 26.7% 15.4% 35-44 20.6% 16.8% 24.4% 21.1% 45-54 15.9% 19.4% 17.8% 18.1% 55-64 11.1% 14.9% 5.6% 15.3% 65-98 17.5% 25.7% 12.2% 21.9%
  22. 22. Funding   2008 MA 2008 MA 2010 MA 2010 MA   Immigrant Non-Immigrant Immigrant Non-Immigrant Funding     Total money invested     0-$10,000 12.5% 32.3% 50.0% 44.4% $10,000 to $50,000 12.5% 9.7% 0.0% 22.2% $50,001 to $500,000 37.5% 12.9% 25.0% 26.7% $500,001 to $5,000,000 0.0% 6.5% 12.5% 2.2% $5,000,001 to highest 37.5% 38.7% 12.5% 4.4%
  23. 23. Social Entrepreneurship   2008 MA 2008 MA 2010 MA 2010 MA   Immigrant Non-Immigrant Immigrant Non-Immigrant Social Entrepreneurship     New firm entrepreneur     For-profit economic goals 37.5% 40.0% 25.0% 36.4% For-profit social goals 0.0% 3.3% 12.5% 13.6% For-profit equal economic/social 25.0% 43.3% 62.5% 40.9% Non-profit 0.0% 3.3% 0.0% 2.3% Established     For-profit economic goals 100.0% 53.2% 33.3% 56.4% For-profit social goals 0.0% 4.8% 0.0% 10.3% For-profit equal economic/social 0.0% 35.5% 66.7% 29.5% Non-profit 0.0% 3.2% 0.0% 1.3%
  24. 24. Massachusetts /US immigration data 2010   2010 MA 2010 US   Immigrant Immigrant   n=90 n=306 Opportunity 77.8% 40.0% Necessity 22.2% 60.0% TEA 10.0% 5.9% Nascent entrepreneur 7.8% 4.6% New firm entrepreneur 2.2% 1.0% Established 1.1% 7.2% Closing 2.2% 0.3%
  25. 25. Entrepreneurial Climate   2010 MA 2010 US   Immigrant Immigrant   n=90 n=306 Opportunity startups 6 months 36.8% 37.8% Business good career choice 61.4% 68.1% Success bus leads to status 70.0% 72.7% Media coverage of new bus 80.2% 68.2%
  26. 26. Age and gender 64.4% 57.8%   2010 MA 2010 US   Immigrant Immigrant Gender Female 48.9% 50.7% Male 51.1% 49.3%   2010 MA 2010 US   Immigrant Immigrant Age 18-24 13.3% 12.4% 25-34 26.7% 19.6% 35-44 24.4% 25.8% 45-54 17.8% 20.6% 55-64 5.6% 10.8% 65-98 12.2% 10.8%
  27. 27. Funding   2010 MA 2010 US   Immigrant Immigrant Funding Total money invested 0-$10,000 50.0% 25.0% $10,000 to $50,000 0.0% 25.0% $50,001 to $500,000 25.0% 50.0% $500,001 to $5,000,000 12.5% 0.0% $5,000,001 to highest 12.5% 0.0%
  28. 28. Social Entrepreneurship   2010 MA 2010 US   Immigrant Immigrant Social Entrepreneurship Start Up For-profit economic goals 25.0% 53.8% For-profit social goals 12.5% 7.7% For-profit equal economic/social 62.5% 38.5% Non-profit 0.0% 0.0% Owner-Manager For-profit economic goals 33.3% 58.3% For-profit social goals 0.0% 4.2% For-profit equal economic/social 66.7% 33.3% Non-profit 0.0% 4.2%
  29. 29. <ul><ul><li>Immigrants compare favorably to non immigrants in the us in terms of: </li></ul></ul><ul><ul><ul><li>TEA </li></ul></ul></ul><ul><ul><ul><li>Perceptions of entrepreneurs </li></ul></ul></ul><ul><ul><ul><li>FUNDING??? </li></ul></ul></ul><ul><ul><ul><li>Much younger </li></ul></ul></ul><ul><ul><li>Massachusetts immigrant entrepreneurs compare favorably to </li></ul></ul><ul><ul><ul><li>Non immigrant entrepreneurs in MA </li></ul></ul></ul><ul><ul><ul><li>Immigrant entrepreneurs in the US </li></ul></ul></ul>
  30. 30. <ul><li>Immigrants clearly contributing to wealth and entrepreneurial activity in the US and in Massachusetts </li></ul>

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