Immigrant entrepreneurship on the move: A longitudinal analysis of first and second generation immigrant entrepreneurship in the Netherlands

Second generation immigrants starting businesses in non-traditional immigrant industries have inspired a new line of research on migrant entrepreneurship. New entrepreneurs are expected to profit from better economic prospects due to their relatively high levels of human capital and their better integration into society compared to their colleagues of their parent's generation. So far it is unclear whether these expectations have been met due to lack of reliable data on immigrants in general and immigrant entrepreneurs in particular. This paper uses newly available data from Statistics Netherlands (1999 - 2004) to compare the differences between business success of second generation and first generation immigrant entrepreneurs. The data allow a comparison of these intergenerational differences for each of the five major non-Western groups of immigrants in the Netherlands and contrast them with developments among native entrepreneurs both in inter-temporal and longitudinal perspective. Contrary to what is usually expected, higher levels of socio-cultural integration of second generation immigrants do not lead uniformly to better business prospects. The differences between the major ethnic groups of immigrants are noteworthy as are the differences with non-immigrant entrepreneurs. While high levels of human capital and social integration foster entrepreneurial success, they are no guarantee for good business prospects.

Keywords: Immigrant entrepreneurship, intergenerational differences, business performance, migrant integration, non-Western migrants

JEL codes: R23, J11, J15