Impact of urban conditions on firm performance of migrant entrepreneurs: A comparative Dutch-US study

Abstract

Recent studies on ethnic entrepreneurship have pointed at an increasing share of migrants in urban small- and medium-sized entrepreneurial businesses. These migrant activities are crucial to the urban economy in many countries, as they employ a significant part of the workforce. The main objective of our study is to identify success conditions of ethnic entrepreneurship by using concepts from social capital and human capital from the literature on empirical factors that are responsible for successful ethnic entrepreneurship. The empirical part of the paper is based on a survey questionnaire among migrant entrepreneurs in the city of Amsterdam in the Netherlands and in Fairfax, County in the state of Virginia in the US. We present an overview of cultural, ethno-psychological and motivational aspects that contribute to the understanding of similarities and differences between ethnic entrepreneurs in both locations. The analysis is structured around several dimensions of social and human capital including personal and business characteristics, and network participation for improving business performance. The findings of the two studies are compared to explore a possible correspondence in business performance patterns. The research tool used to assess performance is Data Envelopment Analysis (DEA), a technique for comparative efficiency analysis in various types of corporate organizations. Finally, concluding remarks are presented and possible extensions of the analysis are suggested. © Springer-Verlag 2009.