Int. J. of Business and Globalisation   »   2008 Vol.2, No.2



Title: Impact of ethnicity on financing of immigrant businesses


Author: Sibylle Heilbrunn, Nonna Kushnirovich


Department of Business Administration, Institute for Immigration and Integration, The Ruppin Academic Center, Emek Hefer 40250, Israel.
Department of Economics and Management, Institute for Immigration and Integration, The Ruppin Academic Center, Emek Hefer 40250, Israel


Abstract: The purpose of this study is to investigate how ethnicity and co-ethnic business dealing affects financing patterns of immigrant entrepreneurs. The study examines differences in financing between immigrant and non-immigrant businesses, investigating whether these differences are caused by co-ethnic business dealing of immigrant entrepreneurs. The target research population consisted of Israeli born and FSU immigrant entrepreneurs who came to Israel between 1989 and 2006. Based on a combination of convenient and snowball samples, 183 FSU immigrant and 244 Israel-born business owners were surveyed. Three groups of entrepreneurs are compared: immigrant co-ethnic entrepreneurs, immigrant non-ethnic entrepreneurs and Israeli born entrepreneurs. Our study revealed that co-ethnic business dealing does not influence start-up funds of immigrant business but does affect the problems encountered when recruiting ongoing funds and accessing trade credit. Co-ethnic business dealing fills in immigrant entrepreneurs' lack of social capital, but does not constitute a competitive advantage for them.


Keywords: immigrant entrepreneurship; financing; co-ethnic business dealings; Israel; ethnicity; start-up funds; trade credit; social capital.


DOI: 10.1504/IJBG.2008.016623


Int. J. of Business and Globalisation, 2008 Vol.2, No.2, pp.146 - 159


Available online: 11 Jan 2008



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