Keywords

1 Introduction

Being an entrepreneur in the diaspora is coupled with networking transnationally and with doing business internationally. It is well known that entrepreneurs’ transnational networking is benefiting international business, especially exporting, and that diasporic entrepreneurs are networking transnationally and doing international business more than natives (Elo 2015).

The coupling of diaspora status with networking and international business enhances economic performance. However, far less is known about the embeddedness of non-economic outcomes in networking and international business. The ultimate outcome may not be economic performance but well-being and happiness. Expectedly, like economic action, an entrepreneurs’ satisfaction with life is embedded in networking and international business (Aliaga-Isla and Rialp 2013).

This frames this chapter’s research question: how is life-satisfaction of entrepreneurs shaped by being in the diaspora and by transnational networking and exporting? Is entrepreneurs’ satisfaction with life dependent on whether they are natives or diasporans in first or second generation? Is their satisfaction benefiting from transnational networking and exporting?

Answers to these questions contribute to understanding how well-being and happiness of entrepreneurs in first and second generation in the diaspora, contrasted native entrepreneurs, is shaped by transnational networking and international business (Gedajlovic et al. 2013).

Answers are here obtained by analyzing a globally representative sample of entrepreneurs, uniquely surveyed in the Global Entrepreneurship Monitor, enabling generalization to the world’s native and diasporic entrepreneurs.

The following sections review the theoretical background, develop hypotheses, describe the research design and data, report analyses and results, and conclude by considering contributions and further research.

2 Theoretical Background: Diaspora, Networking, and International Business

The theoretical background concerns how entrepreneurs are networking transnationally, how networking affects exporting, and how entrepreneurs in the diaspora are exporting.

2.1 Transnational Networks Around Entrepreneurs in the Diaspora

Entrepreneurs are networking with others for advice and other resources. Some entrepreneurs are networking transnationally, with people who are abroad or who have come from abroad (Salaff et al. 2003; Stephens 2013). Migrant entrepreneurs, i.e. entrepreneurs in a country who were born in another country, often have transnational networks, especially with people in their country of origin (Honig et al. 2010; Portes et al. 2002; Schøtt 2017b, 2018). Indeed, such first generation migrant entrepreneurs tend to be networking transnationally more than native entrepreneurs, i.e. entrepreneurs who were born in the country and whose parents were also both born in the country, as shown in detail in a global study (Ashourizadeh 2017a). Second generation diasporic entrepreneurs, i.e. entrepreneurs born in the country, but with a foreign-born parent, tend to be networking transnationally more than natives, but less than first generation migrants (op. cit.). These tendencies of entrepreneurs in the diaspora to be networking transnationally are reconfirmed here, as one of the starting points for this study.

2.2 Transnational Networking and Exporting

Entrepreneurs’ often network transnationally to promote exporting. This has been found in numerous small scale surveys (Elo 2015; Flap et al. 2000). Indeed, transnational networking benefits exporting worldwide as evidenced in recent global studies (Ashourizadeh and Schøtt 2015; Ashourizadeh et al. 2014; Jensen and Schøtt 2015). Conversely, exporting is likely to boost transnational networking. The benefit of transnational networking for exporting is reconfirmed here, as another starting point for this study.

2.3 Exporting in the Diaspora

Partly as a consequence of their transnational networking, entrepreneurs in the diaspora tend to be exporting more than natives, as shown in many small scale analyses (Ashourizadeh 2017b; Brzozowski et al. 2014; Elo 2015; Enderwick et al. 2011; Zhou et al. 2007), and also in detail in a global analysis (Ashourizadeh 2017a). Specifically, both first generation migrant entrepreneurs and second generation diasporic entrepreneurs are exporting more than natives (op. cit.). The tendency for entrepreneurs in the diaspora to be exporting is also reconfirmed here, as yet another starting point for this study.

3 Hypotheses: Satisfaction Benefiting from Diasporic Status, Networking and Exporting

The outcome of economic endeavors is typically considered in economic terms, as economic performance, survival and profit. Increasingly, however, outcomes are also considered in non-economic terms, as more ultimate outcomes, especially as well-being, happiness or satisfaction with life.

People differ in their satisfaction with life, partly according to their circumstances. Native entrepreneurs, first generation migrants, and second generation diasporic entrepreneurs expectedly differ in their life-satisfaction (Schøtt 2018). This first hypothesis can be elaborated by considering who is most and who is least satisfied with life.

A common image of migrants is that they are miserable. This is epitomized in Bob Dylan’s lyrics “I pity the poor immigrant who wishes he would have stayed home”. However, this study does not consider migrants in general, but those who are entrepreneurs, i.e. owning and managing a starting or operating business, and migrant entrepreneurs in first and second generation are rather similar and similar to the natives in their experiences of pull of opportunity and push of necessity, and incomes are rather similar across the three kinds of entrepreneurs and considerably higher than the incomes of ordinary people. Diasporic people tend have entrepreneurial intentions more frequently than surrounding native people, because they tend to be embedded in home-societies with strong traditions of entrepreneurship and embedded in host-societies with weaker traditions of entrepreneurship among the surrounding native people (Schøtt 2016, 2017a). The diasporic entrepreneurs have succeeded in realizing their entrepreneurial intentions and create businesses that have survived, at least until time when surveyed about their satisfaction with life, while many other diasporic people have intended or tried to start but have abandoned their entrepreneurial endeavor, and thus are not studied here. Compared to the diasporic entrepreneurs, fewer native people have abandoned an entrepreneurial endeavor, and native entrepreneurs’ survival is less exceptional, so the native entrepreneurs are therefore not achieving as much and not as satisfied as the diasporic entrepreneurs, we should expect. This theorizing is, in general terms, that a person such as an entrepreneur makes a self-evaluation as satisfied with survival by comparison to others, a reference-group, which for a diasporic entrepreneur is likely to be other diasporic entrepreneurs and past entrepreneurs and their business experiences and for a native entrepreneur is likely to be other native current and past entrepreneurs and their experiences (an example of such contextualization of people’s satisfaction is Zhou and Xie 2015). This difference can be stated as two hypotheses:

H1a

Life-satisfaction is higher for first generation migrant entrepreneurs than for native entrepreneurs.

H1b

Life-satisfaction is higher for second generation diasporic entrepreneurs than for native entrepreneurs.

First generation diasporans may differ from second generation diasporans in a similar manner (Beckers and Blumberg 2013; Masurel and Nijkamp 2004; Portes et al. 2009; Wyrwich 2015). Among first generation migrants, becoming an entrepreneur is a great achievement, both in that it successfully manifests their strong embeddedness in their home-society with its typically strong tradition of entrepreneurship, and in that they have succeed against all odds, knowing that especially many first generation migrants intend and try to become entrepreneurs but quickly abandon the entrepreneurial endeavor. The second generation diasporic entrepreneurs are less frequently than the first generation abandoning their entrepreneurial endeavor, so survival is more common and is not quite as much an achievement, and is not quite as satisfying as for first generation migrant entrepreneurs. This generational difference can be stated as yet another hypothesis,

H1c

Life-satisfaction is higher for first generation migrant entrepreneurs than for second generation diasporic entrepreneurs.

Diasporic status is not the only circumstance affecting satisfaction. A person’s satisfaction also depends on the network around the person. In general, people’s networking is related to their happiness, in that people with large networks tend to be happier than people with small networks (Zhu et al. 2013). This can here be considered a hypothesis specifically about entrepreneurs and their transnational networking,

H2

Networking affects life-satisfaction positively.

Entrepreneurs’ transnational networking is related to international business, and we should expect this to also affect their satisfaction. Exporting is an accomplishment, a successful performance in the role as entrepreneur. The satisfaction from exporting is not merely deriving from the income from exporting, but expectedly derives from fulfilling the human need for relatedness, relating to others, which is considered a basic human need in contemporary social-psychological theory of self-determination (Ryan and Deci 2000). In general, people’s good performance in their role tends to promote their well-being (Bandura 1986). The satisfaction from good performance, more encompassing than exporting, expectedly also derives from fulfilment of the human need for competence, a feeling of being competent, which is also considered a fundamental need in the theory of self-determination (Ryan and Deci 2000). This can here be considered a hypothesis about entrepreneurs,

H3

Exporting affects life-satisfaction positively.

The coupling among diasporic status, networking and exporting, as well as their hypothesized effects on life-satisfaction, are represented in the scheme in Fig. 1, with comparisons among natives and first and second generation diasporans.

Fig. 1
A schematic includes the first and second generations pointing to life satisfaction through H 1 a, H 1 b, H 1 c, or through exporting and through H 3, or through networking and through H 2.

Scheme of satisfaction affected by diaspora status, networking and exporting

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The effects in the scheme are analyzed in the following.

4 Research Design

The ideas concern behavior of entrepreneurs, so we study a population of entrepreneurs. The ideas are not limited to entrepreneurs in a particular place, so we study the population of entrepreneurs in the world. Data on entrepreneurs around the world are collected in the Global Entrepreneurship Monitor, GEM (Reynolds et al. 2005). GEM is annually conducting the largest survey in the world of people’s involvement in entrepreneurship, specifically entrepreneurs as those owning and managing a starting or operating business. Most of the GEM data are made publicly available (Global Entrepreneurship Research Association 2017). GEM data are used extensively for academic studies (Bosma 2013), also focusing on entrepreneurs in the diasporas (Vorderwülbecke 2013), entrepreneurs’ transnational networking (Cheraghi and Schøtt 2015), and entrepreneurs’ exporting (Ashourizadeh et al. 2015).

4.1 Sampling

GEM surveys the adults around the world, annually, with a questionnaire that has a stable set of questions, e.g. exporting, and some questions that have been included only in some countries in some years, notably the three questions asking about migration, networking and satisfaction. We therefore include the survey from those countries and years which have asked about migration, networking or satisfaction. More precisely, the sample is those entrepreneurs who reported on migration, networking or satisfaction. This sample totals 128,457 entrepreneurs who were surveyed in 92 countries within the period 2009–2014. This set of countries has a high degree of representativeness of the countries around the world, and within each country, people are sampled randomly, so the sample of entrepreneurs has a high degree of representativeness of the entrepreneurs in the world. This sample is used for describing the world’s entrepreneurs (Table 1).

Table 1 Distribution of each variable in the sample
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The total sample of entrepreneurs includes a subsample of 4865 diasporans, as defined below. They were residing in 68 host countries and originated from 176 home countries. This subsample has a high degree of representativeness of the world’s diasporic entrepreneurs.

Each analysis of association uses a subsample of entrepreneurs, namely the subsample on which all the analyzed variables are measured. Representativeness of sampling, also of the samples in subsets of countries used for the various analyses of association, implies that the findings can be generalized to the entrepreneurs in the world.

4.2 Measurements

The following first describes the classification of people as first generation migrants, second generation diasporans, and natives (Elo 2015). Then we describe the measurement of the other variables of interest, i.e. life-satisfaction, exporting and networking, and the variables used as controls in multivariate analyses.

4.2.1 Diaspora Status: Natives and First and Second Generation in Diaspora

People are classified as either natives, first generation diasporans, or second generation diasporans. The natives (or indigenous) here refer to those living in the country that they were born in and that also both parents were born in. The first generation diasporans (or migrants) are the people living in a country who were born abroad. The second generation diasporans (or children of migrants) denotes the people living in a country who were born in the country and whose father or mother was born abroad. This classification of people was obtained in the GEM survey when asking where the respondent and each parent were born. This trichotomy of status—native, first generation diaspora, and second generation diaspora—is of course a simplification of a more complex reality, where the trichotomy ignores distinctions among ethnicities within a country, and where several people are at the boundary between categories, e.g. third generation diasporans, children with one native parent and one migrant parent, and children of parents on international assignments. GEM has the advantage of identifying second generation diasporans, whereas other survey merely adopts a dichotomous distinction between natives and migrants. More generally, such simplifications inhere in scholarly inquiry and pervade contemporary political discourse and legislation around the world.

4.2.2 Satisfaction with Life

A person’s satisfaction with life was measured with the Satisfaction With Life Scale (SWLS), a scale that is widely used and validated (Pavot and Diener 2008; Powathavee 2008), also in analyses of entrepreneurs (Jensen et al. 2018; Singer et al. 2015). The respondent was asked for extent of agreement with each of five statements,Verse

Verse In most ways, my life is close to my ideal. The conditions of my life are excellent. I am satisfied with my life. So far I have obtained the important things I want in life. If I could live my life again, I would not change anything.

For each statement, agreement is measured on a five-point Likert scale. The five variables are positively correlated (with intercorrelations between.35 and.60, and Cronbach alpha.81), so they can be combined, averaged, into an index of life-satisfaction, which is used for the analyses.

4.2.3 Exporting

The entrepreneur was asked about exporting, What proportion of your customers will normally live outside your country? Asking about customers, rather than sales, is feasible for starting entrepreneurs. This measure of exporting has been used extensively in numerous GEM studies for more than a dozen years, and recently also for entrepreneurs in the diaspora (Cheraghi and Yaghmaei 2017).

4.2.4 Transnational Networking

The entrepreneur was asked about networking with 20 kinds of people in the private sphere, workplace, professions, market, and the transnational environment (Jensen and Schøtt 2017). Transnational networking was indicated by asking, Various people may give you advice on your new business. Have you received advice from any of the following? … Somebody in another country? Somebody who has come from abroad? …. The entrepreneur’s extent of transnational networking is coded 2 if advice was received from somebody abroad and also from somebody who has come from abroad, 1 if advised by one of the two, and 0 if advised neither by one nor by the other. This measure has been used extensively in analyses of entrepreneurs’ transnational networking (Ashourizadeh et al. 2014; Cheraghi et al. 2014), also in the diaspora (Cheraghi and Yaghmaei 2017; Jensen et al. 2015).

4.2.5 Control Variables

The analyses of effects among diaspora status, transnational networking, exporting and satisfaction should control for circumstances that are related to these phenomena. Related circumstances include demographics such as gender, age, education and income, and also networking in other environments than transnationally, and also organizational characteristics such as phase of the business, motives for the business, ownership, and age and size of the business (Bosma 2013). These circumstances are measured in the GEM survey as follows.

  • The entrepreneur’s networking in other spheres was reported along with transnational networking; measures used extensively in recent studies (Ashourizadeh et al. 2014; Cheraghi et al. 2014; Jensen and Schøtt 2017; Schøtt et al. 2014).

  • Market networking is the number of advisors reported out of four: collaborating business, competing business, suppliers, and customers.

  • Professional sphere networking is the number of advisors of the six: accountant, lawyer, bank, investor, researcher, and business consultant.

  • Work-place networking is the number of advisors of the four: boss, co-workers, starter, and mentor.

  • Private sphere networking is the number of advisors of the four: spouse, parents, other family, and friends.

  • Gender is coded 0 for males and 1 for females.

  • Age is coded in years, ranging from 18 to 64 years.

  • Education was indicated by highest level of education completed, and here recoded into years.

  • Income was indicated by asking for household income; then classifying the responses from each country into thirds, and coding lowest third as 1, middle third as 2, and highest third as 3.

  • Phase of the business is coded 0 for starting phase and 1 for operating phase.

  • Motive of the business is reported categorically as either opportunity-motivated, necessity-motivated, motivated by both opportunity and necessity, motivated by seeking opportunity while having a job, or motivated by another reason; for regression analyses the opportunity-motive is the reference and each other motive is coded as a dummy.

  • Owners refer to number of owners of the business, logged to reduce skew.

  • Firm-age is number of years since starting, logged to reduce skew.

  • Firm-size denotes number of persons working for the business, logged to reduce skew.

4.3 Techniques for Analyses

The well-known coupling among networking, exporting and diasporic status is reconfirmed globally, by cross-tabulations. Their effects on life-satisfaction, controlling for other conditions, are tested by linear modeling, with metric coefficients and with standardized coefficients enabling comparisons among effects. The modeling is hierarchical linear modeling which is similar to regression, but is more appropriate by taking into account that the data are hierarchical, with entrepreneurs nested within countries (and also within years of survey), thereby also controlling for country (and year) (Snijders and Bosker 2012).

5 Results

First the sample of entrepreneurs is described, then we analyze the coupling among diasporic status, networking and exporting, and finally we test the hypotheses concerning effects on life-satisfaction.

5.1 Description of Sample

For an initial description of the entrepreneurs we use the total sample of 128,457 entrepreneurs surveyed in 92 countries, from which subsamples are used for the analyses. First, the distribution of each variable is described, Table 1.

Being native is of course typical and being diasporan is atypical, but not a rare occurrence. Transnational networking is similarly atypical, but is also not a seldom occurrence. Exporting is also not typical, but also not rare. Exporting, owners, firm-age and firm-size are highly skewed, so they are logged for the analyses.

Further description of the sample is provided by the correlations, Table 2. The correlations among the independent variables of interest, and also the correlations between the control variables and the independent variables of interest, are all seen to be weak or only moderately strong (up to.45), which indicates that there is not any problem of multicollinearity in the analyses.

Table 2 Correlations among the variables in the sample
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Satisfaction is correlated positively with being first generation migrant, is uncorrelated with being second generation diasporan, and is correlated negatively with being native. This offers the first evidence for the hypotheses that first generation migrants are most satisfied and natives are least satisfied. Satisfaction also correlates positively with exporting and transnational networking, as also hypothesized. These hypotheses are better tested with appropriate controls for other conditions, in a later section.

Exporting and transnational networking are also seen to correlate negatively with being native, positively with being second generation diasporan, and even more with being first generation migrant, as expected. This coupling is examined further in the following.

5.2 Coupling Among Diaspora Status, Networking and Exporting

Transnational networking differs among native and diasporic entrepreneurs, Table 3 (based on 22,197 entrepreneurs surveyed in 35 countries). First generation migrants are networking transnationally more than second generation diasporans, and especially than native entrepreneurs. The association between diasporic status and networking is seen to be moderate, and their coupling is loose rather than tight (Weick 1976). This loose coupling between diaspora status and networking also holds when controlling for other conditions, as shown in a detailed global study by Jensen and colleagues (Jensen et al. 2015).

Table 3 Transnational networking, by native and first and second generation diasporic entrepreneurs
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Exporting also differs among native and diasporic entrepreneurs, Table 4 (based on 50,158 entrepreneurs surveyed in 70 countries). First generation migrant entrepreneurs are exporting more than second generation diasporic entrepreneurs, and especially more than native entrepreneurs. The association between diasporic status and exporting is seen to be moderate, and their coupling is loose rather than strong. This loose coupling between diasporic status and exporting also holds when controlling for other conditions, as shown in a detailed global study by Ashourizadeh and colleagues (Ashourizadeh et al. 2015).

Table 4 Exporting, by native and first and second generation diasporic entrepreneurs
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Exporting is related to transnational networking, Table 5 (based on 67,282 entrepreneurs surveyed in 72 countries). The more entrepreneurs are networking transnationally, the more they tend to be exporting. The association between transnational networking and exporting is seen to be moderate, and it is not a strong coupling. This loose coupling between transnational networking and exporting also holds when controlling for other conditions, as shown in a detailed study by Ashourizadeh et al. (2014).

Table 5 Exporting, according to transnational network around entrepreneurs
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In short, the above analyses reconfirm the loose coupling among diasporic status, transnational networking, and exporting. Our research question is how these coupled conditions shape entrepreneurs’ satisfaction with life.

5.3 Satisfaction Affected by Diaspora Status, Networking and Exporting

Effects upon entrepreneurs’ life-satisfaction are ascertained by coefficients in a linear model, Table 6, a hierarchical linear modeling with entrepreneurs nested within combinations of country and year, as was described above. We use three models, each with its advantages. Model 1 is based on both diasporans and natives, and is especially informative for comparisons between diasporans and natives. Model 2 ignores the distinction between diasporans and natives, and can thereby take advantage of a larger sample for a more powerful test of the effect of exporting. Model 3 is based on the diasporans only, and is especially informative for comparison between first generation and second generation diasporans. The models are used for testing the hypotheses as follows.

Table 6 Satisfaction affected by diasporic status, exporting, and networking
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The first hypothesis, H1a, is that the first generation migrant entrepreneurs are more satisfied than the native entrepreneurs. This is tested in the first model by the coefficient for the dummy contrasting first generation to natives, which is positive and significant. Being first generation migrant entrepreneur, contrasted native entrepreneur, affects life-satisfaction positively. This supports hypothesis H1a.

Hypothesis H1b, that also the second generation diasporic entrepreneurs are more satisfied than the native entrepreneurs, is tested in the first model by the coefficient for the dummy contrasting second generation to natives, which is positive and significant. Being second generation diasporic entrepreneur, contrasted native entrepreneur, affects life-satisfaction positively. This supports hypothesis H1b.

The hypothesis that the first generation is more satisfied than the second generation, H1c, is tested in the last model in Table 6. The coefficient for the generational effect is positive, supporting H1c. Thus the first generation is more satisfied than the second generation.

The hypothesis that transnational networking promotes life-satisfaction, H2, is tested in the first model in Table 6 (and also in the last model). The effect is positive, supporting the hypothesis that transnational networking benefits satisfaction.

The hypothesis that also exporting promotes satisfaction, H3, is also tested in the first model in Table 6. The effect is not statistically discernible in this sample. This calls for further testing. A further test is performed by a larger sample obtained by dropping the variables for diasporic status and networking, which were measured in only some countries. This yields a sample of entrepreneurs from a much larger set of countries, now 71 countries instead of only 15 countries in the first model. This sample is analyzed in the second model in Table 6. The coefficient for exporting is positive and significant. This lends support for H3, that exporting benefits life-satisfaction. As pointed out when specifying the hypothesis, the satisfaction deriving from exporting is interpreted as deriving partly from the fulfillment of the human need for relatedness. Conceivably, the need for relatedness may be fulfilled especially much when the exporting is to the home country. This is an interesting hypothesis for future research.

6 Conclusions

This concluding section summarizes findings, pinpoints contributions, and suggests further research.

6.1 Summary of Findings

Analyses reconfirm, globally, the well-known coupling among diasporic status, transnational networking and exporting, in that entrepreneurs in the diaspora are networking transnationally more than native entrepreneurs, and are exporting more than natives, and that networking promotes exporting. As was hypothesized, entrepreneurs in the first generation diaspora have higher life-satisfaction than those in second generation diaspora, and native entrepreneurs have the lowest life-satisfaction. As was also hypothesized, life-satisfaction is promoted by exporting and by transnational networking.

6.2 Contributions

The study contributes to understanding how life-satisfaction of entrepreneurs is shaped by diasporic status and by transnational networking and exporting, with global generalizability. The image of diasporans, and especially of first generation diasporans, as miserable people, is here shown to be a false image for the entrepreneurs. Indeed, diasporic entrepreneurs, and especially first generation migrant entrepreneurs, are comparatively satisfied with their lives. As discussed when developing the hypotheses, these diasporic entrepreneurs in surviving businesses are successful, especially in the face of their dire necessity to make a living, which is particularly difficult for migrants. Conceivably, and more generally, necessity entrepreneurs may become especially satisfied if they succeed.

More generally, this study contributes to understanding how entrepreneurship in the diaspora benefits in a non-economic way from networking and international business.

A limitation, however, is that, although we find that life-satisfaction benefit from diasporic status, transnational networking and international business, this does not reveal the mechanisms by which these conditions lead to satisfaction. The second generation diasporic entrepreneurs are undoubtedly, like natives, often inheriting businesses from their parents, the first generation diasporic entrepreneurs, and carry on a tradition within their family, and may as successful entrepreneurs fulfill their parents’ dream. As briefly discussed, the mechanisms can expectedly be interpreted by applying the theory of self-determination, which posits fulfilment of basic human needs for relatedness, competence and autonomy as benefiting well-being and satisfaction (Ryan and Deci 2000).

6.3 Further Research

Classical main-stream research on migrant entrepreneurship, and most notably that by Portes, focused on economic conditions, adaptation, integration and performance. That tradition has here been carried a step forward by turning the focus from outcome in the form of economic well-being to outcome in the form of non-economic well-being, specifically satisfaction with life. Indeed, life-satisfaction may be considered an ultimate outcome of entrepreneurial endeavors. Other non-economic outcomes are job-satisfaction and satisfaction with the balance between work and family. These aspects of satisfaction may be especially interesting research topics in the contexts of diasporic status, networks, and international business. We therefore suggest that future research examines how native and diasporic entrepreneurs’ networks and international business shape job-satisfaction and satisfaction with the balance between work and family.

More broadly, finding that diasporic entrepreneurs are satisfied, when compared to native entrepreneurs, calls for deeper investigation of the sources of this satisfaction, such as autonomy on the labor market, competence as expressed in exporting, and relatedness through transnational networks with their home-society, thus both drawing on and testing the theory of self-determination (Ryan and Deci 2000).