Social Capital, Geography, and Survival: Gujarati Immigrant Entrepreneurs in the U.S. Lodging Industry

Immigrant entrepreneurs often rely on their group’s local social capital in their new home market to establish and maintain their businesses. In particular, immigrant entrepreneurs with few resources of their own receive help from those possessing more resources. Supporting these arguments using the empirical setting of Gujarati immigrant entrepreneurs in the lodging industry, we find that the likelihood of survival of an immigrant entrepreneur’s hotel increases when surrounded by higher counts of branded hotels (representing high-resource establishments) owned by individuals from their ethnic group but is unaffected by unbranded hotels (representing low-resource establishments) owned by members of their ethnic group or by branded hotels owned by individuals from other ethnic groups. These results isolate and reinforce the importance of social capital not only for immigrant entrepreneurs but also more generally for any entrepreneurs who are able to participate in ethnic, professional, religious or social groups. __________________ a The authors thank Paul Adler, Bob Gibbons, Anand Swaminathan and Michele Williams for thoughtful comments. We also would like to thank session participants at the American Sociological Association 2004 Annual Meeting, San Francisco. Correspondence to [email protected] or Bridge Hall 307H, Marshall School of Business, University of Southern California, Los Angeles, CA 90089-0808. Phone: (213) 740-9683. Fax: (213) 740-3582.