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What matters for self-employment: Size or characteristics of ethnic enclaves?

2017-12-27


In a new working paper Martin Andersson (affiliated to IFN), Johan P Larsson and Özge Öner (IFN) have studied how self-employment among immigrants from the Middle East is influenced by residency in an ethnic enclave. The researchers show a robust tendency for people to leave non-employment for entrepreneurship if many members of the local diaspora are business owners. Immigrants appear to be significantly less stimulated by people that are not ethnic peers. Though, it appears that it is not the scale, but the quality of local ethnic enclaves that above all influence labor market outcomes for immigrants.

 

The results, the researchers write, provide some support for policy that can target network facilitation among successful and potentially successful immigrants within enclaves. Such ethnic network effects suggest that policy could consider putting efforts in pushing successful examples that can be role models for other in the community.

Read the working paper

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