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Three Essays on Immigrant Entrepreneurship

Hong, Joon Woo
http://rave.ohiolink.edu/etdc/view?acc_num=osu1658412962264801

Abstract Details

2022, Doctor of Philosophy, Ohio State University, Business Administration.
Despite significant interest in immigrant entrepreneurship, we still know relatively little about how ventures created by immigrant entrepreneurs differ from non-immigrant entrepreneurs. Prior research has tended to focus on immigrant entrepreneurs and derived insights without necessarily comparing them with non-immigrants. or use samples of the two that are not adequately matched. Because non-immigrant entrepreneurs are much larger in number and differently distributed across industries than immigrant entrepreneurs, we have underdeveloped notions about how the two types of entrepreneurs vary in their characteristics and achieve important venture outcomes. The purpose of this dissertation is to help address these problems in the literature, by going deeper into the theoretical mechanisms by which immigrant entrepreneurs choose to start entrepreneurial ventures and achieve innovative outcomes. In this dissertation, I examine several different issues relating to immigrant entrepreneurship. I consider how immigrant and non-immigrant entrepreneurs differ in terms of the innovativeness of the ventures they create, and why these differences exist. To do so, I highlight the role of liability of foreignness experienced by entrepreneurial firms. Liability of foreignness is a concept drawn from the international business literature that highlights how lack of knowledge, resources and legitimacy reduce the success of foreign firms in operating in a local environment. I suggest that immigrant entrepreneurs overcome liability of foreignness through greater reliance on knowledge drawn from their home environments, greater absorptive capacity in recombining new knowledge from the host country, and reliance on cultural norms that help them to overcome knowledge deficiencies. By investigating how immigrant entrepreneurs differ in their knowledge management and learning strategies compared to non-immigrant entrepreneurs, this dissertation advances our understanding of a new but key area of inquiry in the entrepreneurship field. The first essay of the dissertation examines differences in the innovation outcomes of new ventures started by immigrant and non-immigrant entrepreneurs. While immigrants are known to start entrepreneurial ventures at a higher proportional rate than their numbers in the population, particularly in high-tech sectors, little is known about how their ventures might differ in the innovations they produce relative to those of non-immigrants. I argue that, due to immigrant entrepreneurs’ ability to source knowledge not from just one but multiple institutional contexts, they develop a more extensive knowledge base with greater absorptive capacity. This higher absorptive capacity allows immigrant entrepreneurs to not only identify, make sense of and utilize a broader range of knowledge, but also come up with more knowledge recombinations, enhancing their innovation output relative to non-immigrant entrepreneurs. In addition, I suggest that the nature of knowledge and experiences gained in contexts outside of the United States can further enhance absorptive capacity, and in turn, the innovation outcomes of immigrants’ ventures. To test these arguments, I hand-collected a large sample of entrepreneurial ventures started by immigrant and non-immigrant entrepreneurs in the software industry. From this sample, I developed a sample in which immigrants’ ventures are matched in key characteristics to those of non-immigrants’ ventures. I find general support for my arguments relating immigrant entrepreneurs’ higher absorptive capacity with more innovative ventures. The second essay examines how ventures started by immigrant entrepreneurs might differ from those by non-immigrant entrepreneurs in the benefits they extract from strategic alliances. Given the expectation that immigrant entrepreneurs suffer from liability of foreignness, I suggest that they will have less ability to form strategic alliances compared to non-immigrant entrepreneurs, leading them to rely more on their own knowledge than on alliance partners. Among immigrant entrepreneurs, those with high entrepreneurial experience will rely less on alliance partners than those with low entrepreneurial experience. In addition, alliances relating to marketing rather than R&D are expected to offer more useful institutional and market-related knowledge to immigrant entrepreneurs that they typically lack. Partnerships with public rather than private firms are likewise expected to be more beneficial for immigrant entrepreneurs due to their ability to afford legitimacy and financial resources that they are unable to easily access elsewhere. Using a similarly matched sample of immigrant and non-immigrant entrepreneurs in the U.S. software industry as that used in the first essay, I find support for all of these arguments. The third essay examines the relative likelihood of entrepreneurial ventures created by immigrants and non-immigrants to fail (i.e., have lower survival rates). Given their liability of foreignness, ventures created by immigrant entrepreneurs may tend to fail more often than those by non-immigrant entrepreneurs. However, I suggest that immigrant entrepreneurs may be motivated to enact a stronger learning orientation to overcome their liability of foreignness. Such a learning orientation may facilitate their search and use of new knowledge, reducing the likelihood of venture failure. In this regard, I examine the role of national culture in affecting the learning orientation of immigrant entrepreneurs. I consider three dimensions of national culture that are likely to influence learning orientation: uncertainty avoidance, collectivism/individualism, and power distance. In particular, I suggest that entrepreneurs from higher uncertainty avoidance, more collectivist and higher power distance cultures will enact a stronger and more widespread search for knowledge and engage in more effective learning that reduces the likelihood of failure. I find partial support for my arguments. In all, the studies in this dissertation demonstrate considerable support for the notion that immigrant entrepreneurs develop more innovative ventures that tend to survive longer than those of non-immigrant entrepreneurs. By demonstrating these relationships in a single industry and using a matched sample of immigrant and non-immigrant ventures, these studies overcome deficiencies of prior studies that are unable to adequately pinpoint how immigrants might differ from non-immigrants in the types of ventures that they create.
Mona Makhija (Advisor)
Benjamin Campbell (Committee Member)
Jaideep Anand (Committee Member)
163 p.
Business Administration; Entrepreneurship
Immigration; Entrepreneurship; Software Industry; Venture Innovation; Venture Failure; Founding Teams

Recommended Citations

Citations

  • Hong, J. W. (2022). Three Essays on Immigrant Entrepreneurship [Doctoral dissertation, Ohio State University]. OhioLINK Electronic Theses and Dissertations Center. http://rave.ohiolink.edu/etdc/view?acc_num=osu1658412962264801

    APA Style (7th edition)

  • Hong, Joon Woo. Three Essays on Immigrant Entrepreneurship. 2022. Ohio State University, Doctoral dissertation. OhioLINK Electronic Theses and Dissertations Center, http://rave.ohiolink.edu/etdc/view?acc_num=osu1658412962264801.

    MLA Style (8th edition)

  • Hong, Joon Woo. "Three Essays on Immigrant Entrepreneurship." Doctoral dissertation, Ohio State University, 2022. http://rave.ohiolink.edu/etdc/view?acc_num=osu1658412962264801

    Chicago Manual of Style (17th edition)

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This open access ETD is published by The Ohio State University and OhioLINK.