The spatial limits to entrepreneurship: Immigrant entrepreneurs in Canada

Abstract

Labour market participation and the income of immigrants in the Canadian economy, both as employees and entrepreneurs, is investigated. Special attention is devoted to the situation of those who entered Canada as business immigrants, who have been admitted into the country due to their past accomplishments in managing and establishing businesses in other parts of the world. This programme is based, essentially, on the logic of globalisation, that success in one location can be replicated in another despite different economic and regulatory environments. Using the Canadian Immigration Database, which links the landing records of immigrants with their subsequent tax returns, the economic performance of different types of immigrants to Canada is explored. The data reveal that business immigrants have lower incomes and rates of entrepreneurship than would be expected; in contrast, refugees settling in Canada appear to have higher rates of participation in the Canadian labour market as well as higher incomes. This turn of events suggests that there are critical spatial limits to entrepreneurial success. More precisely, business acumen gained in one location may not apply in another.