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Migrant entrepreneurship in China: entrepreneurial transition and firm performance

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Listed:
  • Cathy Yang Liu

    (Georgia State University)

  • Lin Ye

    (Sun Yat-Sen University)

  • Bo Feng

    (Georgia State University)

Abstract

China is experiencing rapid urbanization during which millions of migrants move from rural to urban areas. Recently, China initiated the national strategy of “mass entrepreneurship and innovation” to tap into the innovative potential and promote entrepreneurial development among the general public, with rural migrants being one of the targeted groups of this policy. This context calls for a better understanding of rural migrants’ entrepreneurial formation and transition. Using the 2012 and 2014 Chinese Labor-force Dynamics Survey (CLDS) data, we test the importance of human capital, social capital, and community trust on migrants’ entrepreneurial entry with cross-sectional and panel data analyses. We find that rural migrants’ entrepreneurship rates and entrepreneurial entry rates surpass both their urban resident and rural resident counterparts, indicating the active role they play in urban business landscape. While individual characteristics and social networks play similar roles in these three groups’ entrepreneurial transition, rural migrants’ business activities are particularly shaped by their perception of communities. Further analysis of migrant-owned businesses reveals their over-representation in main-street industries but their firm performances are on par with other businesses, suggesting their positive economic contribution in cities.

Suggested Citation

  • Cathy Yang Liu & Lin Ye & Bo Feng, 2019. "Migrant entrepreneurship in China: entrepreneurial transition and firm performance," Small Business Economics, Springer, vol. 52(3), pages 681-696, March.
    • Handle: RePEc:kap:sbusec:v:52:y:2019:i:3:d:10.1007_s11187-017-9979-y
    DOI: 10.1007/s11187-017-9979-y
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    6. Lara Agostini & Federico Caviggioli & Francesco Galati & Barbara Bigliardi, 2020. "A social perspective of knowledge-based innovation: mobility and agglomeration. Introduction to the special section," The Journal of Technology Transfer, Springer, vol. 45(5), pages 1309-1323, October.
    7. Maribel Guerrero & Roseline Wanjiru, 2021. "Entrepreneurial migrants from/in emerging economies: breaking taboos and stereotypes," International Entrepreneurship and Management Journal, Springer, vol. 17(2), pages 477-506, June.
    8. Emily C. Blalock & Xiaojun Lyu, 2021. "Legitimate but “not for me”: The role of validation in migrant entrepreneur understanding of COVID‐19 business support policies in Shanghai," Growth and Change, Wiley Blackwell, vol. 52(3), pages 1482-1508, September.
    9. Muhammad Zeeshan Younas, 2023. "Regional institutional quality and firm-level innovation: a case of selected south asian economies," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(1), pages 615-643, February.
    10. Xu, Xuelu & Jin, Zeyang, 2024. "Impact of Return Migration on Employment Structure: Evidence from Rural China," Journal of Asian Economics, Elsevier, vol. 91(C).
    11. Hayward, Mathew & Cheng, Zhiming & Wang, Haining & Smyth, Russell, 2023. "Parental influence and the propensity for entrepreneurship: Evidence from the one-child policy," Journal of Business Venturing Insights, Elsevier, vol. 20(C).
    12. Bach Nguyen, 2022. "Internal migration and earnings: Do migrant entrepreneurs and migrant employees differ?," Papers in Regional Science, Wiley Blackwell, vol. 101(4), pages 901-944, August.
    13. Haoying Li & Jonas Østergaard Nielsen & Rui Chen, 2023. "Rural Entrepreneurship Development in Southwest China: A Spatiotemporal Analysis," Land, MDPI, vol. 12(4), pages 1-22, March.
    14. Rita Lankauskienė & Živilė Gedminaitė-Raudonė & Rimantas Micka, 2024. "Business Model Innovation for Sustainable Multifunctional Land Management in Abandoned Rural Areas: A Case Study," Land, MDPI, vol. 13(6), pages 1-16, June.
    15. Maribel Guerrero & Vesna Mandakovic & Mauricio Apablaza & Veronica Arriagada, 2021. "Are migrants in/from emerging economies more entrepreneurial than natives?," International Entrepreneurship and Management Journal, Springer, vol. 17(2), pages 527-548, June.
    16. Mingzhi Hu & Yulu Yang & Xiaofen Yu, 2020. "Living better and feeling happier: An investigation into the association between housing quality and happiness," Growth and Change, Wiley Blackwell, vol. 51(3), pages 1224-1238, September.
    17. Huan Yang & Xinning Zhang, 2023. "Persistence of culture: how the entrepreneurial culture of origin contributes to migrant entrepreneurship," Small Business Economics, Springer, vol. 61(3), pages 1179-1204, October.
    18. Ping Zhang & Xin Wei & Guirong Mao, 2024. "Cultural diversity, social integration, and migrant entrepreneurship—evidence from the China migrants dynamic survey," Small Business Economics, Springer, vol. 62(3), pages 1135-1155, March.
    19. Arrighetti, Alessandro & Canello, Jacopo, 2023. "Explaining the Multifaceted Patterns of Migrant Entrepreneurship in the Global Economy: A Resource-Based Approach," EconStor Preprints 273451, ZBW - Leibniz Information Centre for Economics.
    20. Newbert, Scott L. & Kher, Romi & Yang, Shu, 2022. "Now that's interesting and important! Moving beyond averages to increase the inferential value of empirical findings in entrepreneurship research," Journal of Business Venturing, Elsevier, vol. 37(2).
    21. Cheng, Zhiming & Smyth, Russell, 2021. "Education and migrant entrepreneurship in urban China," Journal of Economic Behavior & Organization, Elsevier, vol. 188(C), pages 506-529.

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