Returnee Entrepreneurial Liabilities among the Forced and Voluntary Returnees in Ethiopia

Abstract

Studies on returnee entrepreneurship remain insufficient regarding what deters return migrants’ potential contribution to the local economy. By employing legitimacy and self-efficacy theories, this study aims to provide evidence on the challenges of returnee entrepreneurship in Ethiopia by comparing voluntary returnees and forced returnees running a business in an environment they had been absent from for a prolonged period. We used qualitative interviews to abductively study the challenges returnees undergo as business owners. We interviewed 10 voluntary returnees and 14 forced returnees who are running a business in Ethiopia. The interview data was fed to Nvivo 12 software for coding and category development. We observe that returnee entrepreneurs face three main challenges that we collectively label as a returnee liability; institutional inertia, unrealized expectation, and readjustment crises. However, challenges interact together to constrain returnee endeavors. As we compare the forced and voluntary returnees, we observe that the challenges tend to converge at the institutional level, but manifest in different forms and magnitude among the two groups regarding expectation and readjustment crises. For the forced returnees, migration was found to contribute to the depreciation of their human capital, different from the positive role of migration in the literature. Implications of the study have been discussed.