Faculty of Economics and Business Administration Survival of the fittest among migrant entrepreneurs. A study on differences in the efficiency performance of migrant entrepreneurs in Amsterdam by means of data envelopment analysis

Both locally and globally, we are witnessing a rising interest in innovative entrepreneurial activity as an engine for economic growth. The economic performance of firms (or organizations) can be measured by, inter alia, innovation indicators, market shares, birth/death rates, investment rates and the like, while there is also a great variety of underlying key factors for explaining business performance, such as work attitude, quality and level of education, access to capital, spatial accessibility, network use, etc. In recent years, migrant entrepreneurs have come to occupy a prominent place in the SME sector in many cities in developed countries, with varying degrees of success. The present paper aims to identify and compare the economic performance of individual migrant business firms on the basis of a quantitative assessment of their efficiency profiles. In this context, we will address in particular the drivers and barriers for business strategies of these entrepreneurs. As well as traditional regression methods, a modern operational approach – originating from organizational theory – that aims to make a comparative study of quantitative efficiency differences between individual decision‐making units (DMUs) is provided by Data Envelopment Analysis (DEA). In this paper, DEA will be employed in order to identify relative performance differences between distinct categories of migrant entrepreneurs in the city of Amsterdam. A wealth of relevant data has been collected by systematic interviews and survey questionnaires, and these contain a variety of efficiency‐ oriented indicators, on both the input and the output side. Several sensitivity analyses ─ using cross‐analysis methods ─ are next carried out to test the robustness of our findings by, inter alia, investigating the influence of socio‐cultural ethnic groups, levels of education, first‐ and second‐generation migrants, and age. Finally, the paper offers some lessons on entrepreneurship strategies.