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Migrant Entrepreneurs' Access To Business Finance In Australia

Author

Listed:
  • ANDREW VAN HULTEN

    (Center for Strategic Economic Studies, Victoria University, 300 Flinders Street, 3000 Melbourne, Australia)

  • ABDULLAHI D. AHMED

    (Faculty of Commerce and Law, Central Queensland University, Bruce Highway, Rockhampton, QLD 4702, Australia)

Abstract

Migration status has been neglected both theoretically and empirically in the financial discrimination literature. Drawing on data from a comprehensive survey of small- and medium-sized businesses in Australia, this paper tests whether Australia's migrant entrepreneurs have greater difficulty accessing external business finance than their Australia-born counterparts. In doing so, it tests the theoretical proposition that the passage of time (or time spent in Australia) mediates a relationship between migration status and access to business finance by determining borrow-lender information asymmetries. We find that long-term migrant entrepreneurs are more likely than Australia-born entrepreneurs to: (1) report access to finance as an obstacle, (2) pass up investment opportunities because of inadequate access to finance, and (3) have obtained funding from family and friends. However, no significant differences are found between migrant and Australia-born entrepreneurs in terms of denial and discouragement rates, or their past use of bank finance.

Suggested Citation

  • Andrew Van Hulten & Abdullahi D. Ahmed, 2013. "Migrant Entrepreneurs' Access To Business Finance In Australia," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 18(01), pages 1-22.
    • Handle: RePEc:wsi:jdexxx:v:18:y:2013:i:01:n:s1084946713500039
    DOI: 10.1142/S1084946713500039
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    References listed on IDEAS

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    1. Daniel Aaronson & Paul Huck & Robert M. Townsend, 2000. "Small business access to trade credit: some evidence of ethnic differences," Proceedings 672, Federal Reserve Bank of Chicago.
    2. Albareto, G. & Mistrulli, P.E., 2010. "Bridging the gap between migrants and the banking system," MPRA Paper 26476, University Library of Munich, Germany.
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    Cited by:

    1. Bryan Malki & Timur Uman & Daniel Pittino, 2022. "The entrepreneurial financing of the immigrant entrepreneurs: a literature review," Small Business Economics, Springer, vol. 58(3), pages 1337-1365, March.

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