Chinese create their business relying heavily on their ethnie network; Haitians are ... net economic contributions of immigrants versus their costs to their host economy. ..... Figures 1 and 2 show a comparison of the two communities in .... Entrepreneurship and Small Business: Emerging Trends on the Canadian Scenes.
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Paper presented for the conference "Autrement Entreprenants", Thursday, October 24, 1991,Hotel Queen Elizabeth, Montréal.
New Immigrants and New Businesses : the Chineseand the Haitians in Montreal Gabrielle A. Brenner, Gérard Célas, Jean-Marie Toulouse Cahier de recherchen° 92-03-01 Mars 1992 ISSN : 0840-853X
Copyrighl81992. &ole des Hautes Éludes Commerciales (H.E.C.), Mon~al. Tous droits riserWs pour IOUSpays. Toute lroduction ou lOUIe reproduction sous quelquefomlt: que ce soil eSI illlerdJte. Les It:XIt:SpubUU tùms la série des cahiersde rechercheH.E. C. n'engagenlque la responsabiUlé de leurs auteurs. LA publication de ce cahier de recherche a été rendue possible griJce à des sulm:ntions d 'aUJeà la publication el à la diffusion de la recherche du Conseil de recherches en sciences humaines du Canada (C.R.S.H. C.), du Fonds pou,. la formation de chercheurs el l'aide à la recherche (F.C.A.R.) ou desfonds de l'&ole des H.E.C. Dislribué por la Direction dela recherche, &ole des H.E. C., 5155, avenue DeceUes, MOnlœal (Québec) Canada HJT 1 V6.
Abstract Acknowledging the importance of immigration in Canada,we decided to study the behaviour of Chinese and Haitians in Montreal hoping to understand why they differ in term of business creation. Empirica1 data collected from bath communities indicated that :
mostChineseentrepreneurshad previousentrepreneurialexperience.This is rare amongHaitian entrepreneurs; (3)
immigrantsChineseor Haitians did not corne to Canadawith the intention of creatinga business;
(4)
govemment programs designed to help start-ups are rarely used by immigrants entrepreneurs, specialy in the Chinese community;
(5)
Chinesecreatetheir businessrelyingheavilyon their ethnienetwork;Haitians are more turned towardthe host society.
New Immigrants and New Businesses: The Chineseand the Haitians in Montreal by GabrielleA Brenner,GérardCéIas and Jean-Marie Toulouse 1
1) The coutext of the research ln much of the Western world, questions are continuously raised on the role of immigrants in society. This debate has become even more pressing because of the general aging of the population and the fears of the increasing burden of a retired population on the tax-payers have made governments consider immigration as a possible solution. With the immigrants being cast in this role, questionsof public policy have been raised on the additional effects of immigration on the host society, on the net economic contributions of immigrants versus their costs to their host economy.
Canada has been at the forefront of this debate. Not only does it share the common Western problem of an aging population and a falling birth rate2, but the acute birth rate decline in the province of Quebec has aIso raised the political problem
1
The authon are respectively associate prof essor of economics, muter student in administntion and Maclean Hunter prof essor of entrepreneurship at the École des Hautes Études Commerciales of Montreal. This study has been made possible by the Maclean Hunter Chair of entrepreneurship and ,rants of the École des Hautes Études Commerciales. We allO thaok Chu Yu-Haiang. Alain Tremblay and Serge Trépanier for their dedicated wort and collabontion. AIl remaining errors are IOlely our own.
2
ln ils lait report on immigration for instance, the Economie Council of Canada elliimates lhal even iD the mosI ideal conditions (nel immigralion of 200,000 per year, or 0.8 ~ of the populalion), the dependency rate, which indicates how maDYyoung and relired persona will depend on 100 worlting Canadiana will grow from sixty-five in 1990 10 aevenly-lWo in 2040. If the goal of nel immigration is noI mel il could grow 10 eighty-aeven! (1991. p. 41).
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of its weight in the Confederation. Quebec's population in 1981was 6.4 millions (or 26.5 percent of Canada's population), which was 6.8 percent higher than in 1971. During the period 1979 to 1983 the birth rate has fallen by 12.2 percent and the Quebecgovernment wants to attract immigrants to make up for the shortfall and insure the future growth of its population 1. Quebec especiallywants to attract francophone immigrants and, in tum, is attractive to francophone immigrants, like the Haitian diaspora. Given this background, it is not surprising that in recent years, Canada's federal government has attempted to measurethe economicimpact of both its program promoting the immigration of entrepreneurs and the impact of immigration on the economy2,while the province of Quebec has carried out two studies designed to measure the value of economic contributions by immigrant entrepreneurs3. Both the Canadian and the Quebec governmentshave especiallywanted to attract entrepreneurs4. It has long been recognized that some groups of immigrants have been active in business creation, and govemments faced with the task of choosing
amongpossibleimmigrantshave especiallywantedto target the oneslikely to create businessesand contribute to growth5. The impending takeover of Hong Kong by mainland China has a1socreated a window of opportunity to attract its well-known entrepreneurs6. This has motivated the federal govemment to promote the use of a specialcategory of immigration visasfor the potential immigrants who declare that they will invest in a businessin Canada.
1
ln 1983, thcre were 16,378 immigrants to Quebec while the total immigration to Canada wes 89,157. Thus Quebec's part of 18.3'J wu slightly inferior to its weight in the population.
2
See for instance Samuel and T. Conveys (1986), Nash (1987), Conaeil économique du Canada (1991)..
3
Sec for instance Ministirt:
4
ln his seminal work, the late Shapero has frequently mentioned the contribution of immigrants to business creation.
.5
Sec Pyona Gap Min (1984) on the Korean entrepreneurs; Reeves and Ward (1984) on Pakistani and Indian immigrants in Great Britain.
6
des commu1UlUlésculturelles, Québec, 1986.
A gencral review of the literature can be found in Toulouse and Brenner (1988).
ln 1985, there were 7,380 immigrants from Hong Kong out of a total immigration to Canada of 84,302. See Annuaire du Canada, 1988, table 2,35. A recent Business Week article even attributes the strength ofthc Canadian dollar to the facl thel Canada has welcomed more than 110,000 immigrants from Hong Kong who have brought a flow of around S4 billions a year into Canada (Business Week, 1991).
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2
on the likelihood of creation of businessesby immigrants suffers from a paucity of data. A review of the literature shows that while there has been many studies of ethnie entrepreneurs in the United States and in Great Britain, there is a dearth of comparable studies in Canada. Besides the aiready mentioned studies of the federal and provincial govemments,whose goal was more to assessthe effectivenessof their prograrns than to understand the processof businesscreation among immigrants, there exists only seme studies of entrepreneurs in ethnie communities: Lasry (1982) has studied business creation among the Sephardie Jews of Montrea1, Gutwirth (1973) among the Orthodox Jewish community of this city and Painehaud and Poulin (1988) among the ltalians of the province of Quebec. There are no data on other ethnie communities.
Moreover, there exists no comparative studies of the different
communities' experiences in business creation that would allow to draw policy implications. Because of the laek of data, intervention to help ethnie entrepreneurs may often be doomed to failure, even when they succeedin reaehing their targeted public. It is in this context that we have undertaken a study of businesscreation among immigrant communities. We have until now studied the Chinese communityl and the Haitian community in Montreal.2 ln this paper, we ftrst exposethe methodology of the studies, then we compare some characteristicsof the entrepreneurswe interviewed and compare the experiencesof the two communities. We then compare our results with what has been found in the literature, and we conc1udewith some policy implications.
1 2
See Brenner
and Toulouse
(1990).
SecCé", (1991).
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3
Businesses
II) The methodology of the study. The study was based on long inteIViewswith open and c1osedquestions. Among the Chinese communityl, we inteIViewed thirty-five ethnic Chinese businessowners in the Greater Montreal area in the summer of 1989. To foster trust and not to miss important elements of their responses,the inteIViewswere conducted in Chinese,since these immigrants either do not know English or French weIl enough or are wary of this kind of research, especiallyof the uses of their answers. The questionnaire was filled by the inteIViewer (a member of the community) in Chinese and translated later into French. Becauseof the immigrants' fears of authorities (especiallythe fear of financial information being revealed to the tax authorities), the entrepreneurs in our sample were those that accepted to answer, becauseeither we succeededin reassuring them or they knew one of the researchers personally or had received a favourable recommendation from somebody they trusted. If a bias has been introduced in the sample, we cannot determine its effect on our results2. To study the Haitian community of Montreal, we learned from our first experience. We modified the questionnaire used for the Chinese study to adapt it to the specifie eharacteristiesof the eommunity. Moreover, in this last group we wanted to have a sample not only of the businessowners but also of the non-entrepreneurs. This would enable us to compare the eharaeteristicsof these two populations. Using the phone directory of businessesthat serve the Haitian community in Montreal (le Bottin de la Liberté), we mailed the questionnaire to 150 doctors and other professionals (or sixty percent of the population advertising in the directory). We used a member of the community as interviewer, and he used his own network to reaeh teaehers,entrepreneurs, students and unemployed people of the community. The interviewer also went to diverse businessesand spoke with their owners. ln aIl we succeededin having 130 filled questionnaires on a total of 400 given. ln this community too there were fears about the use of this study that the interviewer had to assuage. People on unemploy-
1
We beaan wilb Ibis community by accident, as we had a Chinese rese8rch aaailltaDl. For such atudies, we need a member
of the community to provide entry and truat. 2
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mention that most studics of immigrant entrepreneurs
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New Immigrants and New Businesses: The Chineseand the Haitians in Montreal ment and welfare were especially fearful, questioning the use of the research and doubting it could have an impact on their problems. We obtained the collaboration of fifty-three entrepreneurs and seventynon-entrepreneurs.
When comparing the two communities in their attitudes toward entrepreneurship and the businessescreated, one must be reminded of a crucial difference among them. The Chinese in our sample,while coming from different countriesI, mainly corne from entrepreneurial familles and from a commercial culture that values entrepreneurship. One of them even commented that Chinese from Indochina are "accustomedto have their own business. .. So, when they save money, they open a business." Moreover, most of the Hong Kong Chinese came under the program of fostering the immigration of entrepreneurs. These immigrants came with money and a plan to start a business.
The Haitian immigrant experienceis different. The Haitian immigration in Quebec may be divided in two phases. Up to 1971,Haiti was a limited source of immigrants for Canada and the Haitian immigrants were mainly professionals who fled the repressive Duvalier regime. The sooies was a period when the expanding Quebec economy was able to absorb Haitian doctors, nurses and teachers (Déjean, 1978). Bastien (1986) saysthat up to 1971,more than fifty percent of the Haitian immigrants had a schooling level of thirteen years and more. Mass immigration only started in the seventieswhen the worsening economic conditions forced the Haitian peasantsto look for a haven2. These immigrants had much lessschooling than their predecessors,some did not speak French and had more problems integrating. The attitude of these two waves of Haitian immigration toward entrepreneurship is different. The professionais who arrived in the sooies did not have any problems fmding work in their chosen field and were not interested in businesscreation. On the other hand, the poorly educated immigrants of the secondwaves,who mainly work in precarious conditions, did find that their dreams of a better life could not be fulfilled
1
Sevencame from Taiwan, aixlecn from HOOI Kong, five from mainlandChina, four from lndochina and two from Malayaia.
2
BcrœcbeandManin (1984)mentionthatfrom 1974to 1978Haitiwasoneof thetirst sourceof immigrants for Quebec.
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