Academic journal article Contemporary Management Research

Mediating Effects of Business Success on the Relation between Business Issues and Business Prospects Amongst Immigrant Entrepreneurs in Malaysia

Academic journal article Contemporary Management Research

Mediating Effects of Business Success on the Relation between Business Issues and Business Prospects Amongst Immigrant Entrepreneurs in Malaysia

Article excerpt

INTRODUCTION

Economic activities carried out by immigrant entrepreneurs have received considerable recognition. They are regarded as a huge potential source of entrepreneurial development and economic impetus for respective recipient countries. The presence of immigrant entrepreneurs and their role in and contribution to the establishment and growth of new businesses, especially small businesses, have been illustrated well in the previous empirical studies (see Lin, 2015; Ribeiro-Soriano & Mas-Verdú, 2015). The host countries benefit from immigrant entrepreneurs who invest physical capital, create jobs for local workers, provide training and innovation, provide a relatively more equitable income distribution, and contribute to the country's GDP.

The significant role of immigrant entrepreneurs in economic growth, including starting up, maintaining, and expanding their businesses, have been recognized. Despite all this, they appear to have higher entrepreneurial drive, higher survival strengths, and higher start-up as well as expanding business activities compared to their native-born counterparts (Desiderio, 2014). Some European countries provide special visas and entry programmes to immigrant entrepreneurs to tap or promote potential business activities and obtain foreign investment. In addition, the top four settlement countries, i.e., Canada, Australia, the United States, and New Zealand have increasingly realized the value of immigrant entrepreneurial activities, economic competitiveness, and innovation (see Desiderio, 2014). With increasing international migration, more host countries, developed and developing ones, have been encouraging immigrant entrepreneurs to establish their business.

As many other emerging markets, Malaysia has become one of the hosting countries for immigrant entrepreneurs in the last two or three decades (Rahmandoust, Ahmadian, & Shah, 2011). Nonetheless, their presence in entrepreneurial pursuit has not been researched much due to a dearth of knowledge and empirical research on the mediating role of the business success of immigrant entrepreneurs in the relationship between business issues and business prospects. Entrepreneurial business issues and business prospects have therefore been used as dependent variables respectively. This need becomes more apparent as a considerable proportion of them migrate specifically to initiate new venture start-up activities. What are the specific issues confronting them? To what extent they have overcome obstacles and become successful? How do they perceive their business prospects? To what extent does business success mediate the relationship between business issues and future business prospects? What conclusions can be drawn? This article attempts to address those probing questions based on a survey of 314 immigrant entrepreneurs in Kuala Lumpur, Malaysia.

A SHORT REVIEW OF THE LITERATURE

In this study, immigrant entrepreneurs are defined as individuals who establish, maintain, and expand their businesses outside their home country. Many previous research studies have highlighted the challenges that business immigrants face, including difficulties in identifying opportunities in a new environment (Portes & Yiu, 2013). This requires a more demanding and vigilant approach for immigrant entrepreneurs to start-up, survive, and sustain their business ventures (Nam, 2015). With the growing importance of immigrant entrepreneurs in host countries, it is essential to understand business issues they are likely to face as well as consider their business success and business prospects. of the next section reviews some notable issues and challenges that affect the success of immigrant entrepreneurs. This review considers their success and prospects to design a conceptual framework of the research.

Immigrant Entrepreneurial Issues and Obstacles

While entrepreneurial business issues and obstacles that immigrant entrepreneurs confront have not been studied extensively, many agree that the adequate funding start-up and develop their businesses from financial institutions is an utmost importance, especially since most of their capital financing come from their families and friends (Alam & Hoque, 2010; Desiderio, 2014; Sanders & Nee, 1996). …

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