Internationalisation of a Migrant Family Firm and Contextual Uncertainty: The Role of Ethnic Social Networks

Abstract

There is a dearth of studies that investigate how and why firms, formed by migrant families in uncertain contexts, internationalise. Such topic is important as there are calls to understand the unique approach migrant families in business may take to address contextual uncertainty.Recent studies suggest that a focus on social networks may help to theorize the way migrant families in business go beyond host country borders. We argue that the social resources that migrant families in business leverage to internationalise, particularly ethnic networks, may provide them with both advantages and disadvantages. This chapter relies on a single case study of a diversified agrobusiness, owned and managed by a German migrant family in business in Nicaragua. Findings reveal how contextual challenges foster the early and continued reliance on ethnic networks to internationalise. Critical events reinforce such dependence yet prompt the expansion of existing networks beyond family and ethnic circles.The chapter contributes to extending knowledge in the fields of internationalisation and family business in developing economies.

Guest editorial: Migrant entrepreneurship and the roles of family beyond place and space: towards a family resourcefulness across borders perspective

“…Ethnic boundaries are key as a bridge to the broader society (Verver et al , 2019, 2020). Some migrants keep strong connections in their countries of origin due to the presence of family members there while these migrants endure family responsibilities and integrate into their new country of residence (Centeno-Caffarena and Discua Cruz, 2021; Azmat and Fujimoto, 2016). In contrast, other migrants might choose to minimize interaction or cease connections with their country of origin forcibly or voluntarily and choose to settle down in the new country of residence (Park and Waldinger, 2017; Evansluong, 2016).…”

“…Since migrant entrepreneurs might be embedded in the country of residence and origin (Drori et al , 2009), entrepreneurs, their families and contexts are shaped by inducing processes, practices and outcomes of migrant entrepreneurship (Verver et al , 2019). It is, therefore, vital not to overlook the interplay between the multiple aspects of a migrant’s spatial and family embeddedness and migrant entrepreneurship (Centeno-Caffarena and Discua Cruz, 2021). Family members are embedded primarily in their extended family and kin constellations that may be diasporic, multi-layered and highly globally dispersed (Elo and Dana, 2019).…”

23 Migrant Business Families in Central America

“…Recent studies suggest that in adverse or uncertain environments the features of social ethnic networks could be relevant for migrant families in business over time (Centeno-Caffarena and Discua Cruz, 2021) yet do not expand as to how such features emerge or influence their adaptation over time. We argue that further exploration of the historical and contextual influences may provide some explanations (Carney and Gedajlovic, 2003;Colli et al, 2003;Wright et al, 2014) A historical approach is important to understand business families in previously unexplored contexts (Carney and Gedajlovic, 2003).…”

“…Yet, the need to develop strong ethnic ties to conduct business activities, both in Nicaragua with the German community became necessary. Many German migrant business families created firms with the German market as the prime target for export, developing diverse industries in the country, and strengthening the commercial and ethnic links between families in the two countries (Centeno-Caffarena and Discua Cruz, 2021). From 1852 to 1858 the German government appointed consuls in the most important Nicaraguan cities linked to a growth in trade between the two countries fueled by German migrant business families.…”

“…The emergence and development of businesses by migrants or their descendants has not gone unnoticed in the developed world (Fearnow, 2019;Moules, 2014;Spielmann et al, 2021) yet there is little understanding about how migrant business families emerged and adapted in developing countries. In this study, a migrant business family relates to members of a family of migrants, or descendants of migrants, that engage in the foundation, management and continuity of one or several family business ventures over time (Centeno-Caffarena and Discua Cruz, 2021;Elo et al, 2018). Studying migrant business families is important as recent studies suggest shifting our attention from the firm to the family level of analysis (Discua Cruz and Basco, 2018;Hamilton et al, 2017).…”