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18 Aug 2016Working Paper Summaries

Immigrant Entrepreneurship

by Sari Pekkala Kerr and William R. Kerr

Immigrant entrepreneurship is a topic of key policy interest but one with few facts. The authors construct a data platform using US Census Bureau administrative data to provide new statistics on the patterns of business formation by immigrant entrepreneurs and on the medium-term success of those businesses. Immigrants account for around a quarter of US entrepreneurs, and this share has been increasing since 1995. Immigrant entrepreneurs display a stronger up-or-out dynamic that is typical of young firm growth than natives—they fail more frequently, but immigrant-founded firms that persist experience greater employment growth compared to their native counterparts.

Author Abstract

We examine immigrant entrepreneurship and the survival and growth of immigrant-founded businesses over time relative to native-founded companies. Our work quantifies immigrant contributions to new firm creation in a wide variety of fields using multiple definitions. While significant research effort has gone into understanding the economic impact of immigration into the United States, comprehensive data for quantifying immigrant entrepreneurship are difficult to assemble. We combine several restricted-access U.S. Census Bureau data sets to create a unique longitudinal data platform that covers 1992–2008 and many states. We describe differences in the types of businesses initially formed by immigrants and their medium-term growth patterns. We also consider the relationship of these outcomes to the immigrants’ age at arrival to the United States.

Paper Information

Full Working Paper Text
Working Paper Publication Date: July 2016
HBS Working Paper Number: 17-011
Faculty Unit(s): Entrepreneurial Management

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William R. Kerr

William R. Kerr

Dimitri V. D'Arbeloff - MBA Class of 1955 Professor of Business Administration

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