Immigration, Education and Entrepreneurship in Developed Countries

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Purpose – The purpose of this paper is to provide a country-level consideration of the relationship between entrepreneurship, immigration and education. In contrast to studies that report on immigration and entrepreneurship in a region or single country, the authors seek to determine whether levels of immigration, and the level of education obtained by the immigrants, are predictive of levels of entrepreneurship activity. A common set of variables and data from developed countries are used to test the hypothesized relationships.

Design/methodology/approach – Using data on 21 OECD countries and five measures of entrepreneurship from the Global Entrepreneurship Monitor project, the authors assess the significance of immigration and education level on entrepreneurial activity using regression analysis.

Findings – The stock of immigrants in a country was found to be predictive of the proportion of that country’s population involved in starting and managing a new business (early stage entrepreneurship), as well as the growth expectations held by those early-stage entrepreneurs. Also, levels of high growth and high growth expectation entrepreneurship were predicted by the proportion of more highly-educated immigrants.

Originality/value – This study provides national-level comparative evidence linking entrepreneurial activity to immigration and to the level of education obtained by those immigrants, thereby adding to our understanding of immigration, education and entrepreneurship. The results have implications for the immigration policies of countries seeking to add to their economic base by encouraging entrepreneurship and job creation.