Social capital, networks, trust and immigrant entrepreneurship: a cross-country analysis

Purpose - This study is devoted to the empirical assessment of the macro-level impact of social capital on immigrant entrepreneurship (the general levels of immigrant entrepreneurship, as well as high-value added immigrant entrepreneurship). Design/methodology/approach - The paper applies multiple regression analysis to the data on immigrant entrepreneurship and high-value added immigrant entrepreneurship provided by OECD. The measures of the independent variables (the components of social capital) are based on World Value Survey. Findings - The results reveal that social capital does play a significant role in high-value added immigrant entrepreneurship in particular and immigrant entrepreneurship in general. With strong statistical significance, three social capital factors - networking, interpersonal trust, and institutional trust - provide an explanation for variations in immigrant entrepreneurship across countries. Originality/value - Although the literature has long pointed out the importance of social capital as a determinant of economic activity, entrepreneurship researchers have focused much attention on the impact of personal, economic, and politico-administrative factors while leaving social capital factors largely unexamined. Thus, study offers a systematic analysis of the effects of social capital on immigrant entrepreneurship and high-value added immigrant entrepreneurship at a macro level and discusses policy-making implications.