We are extremely grateful to Kiran Karnik and Sunil Mehta at NASSCOM for allowing us to survey NASSCOM members for this research. This paper has benefited from very helpful discussions with Abhijit Banerjee, Rodrigo Canales, Sylvain Chassang, Bob Gibbons, William Kerr, Asim Ijaz Khwaja, Karim Lakhani, Josh Lerner, Rafel Lucea, John McHale, Antoinette Schoar, Jordan Siegel, and especially Kevin Boudreau, Nicola Lacetera and the coeditor and two anonymous referees. We thank the participants of the MIT Development and Organizational Economics Lunches, the Myron Weiner Seminar on International Migration, the HBS International Seminar and the AEA panel on “Networks, Spillovers, and the Globalization of Innovation and Entrepreneurship” for their comments on earlier stages of this research. All errors are our own.
Diasporas and Domestic Entrepreneurs: Evidence from the Indian Software Industry
Article first published online: 22 NOV 2010
© 2010 Wiley Periodicals, Inc.
Journal of Economics & Management Strategy
Volume 19, Issue 4, pages 991–1012, Winter 2010
How to Cite
Nanda, R. and Khanna, T. (2010), Diasporas and Domestic Entrepreneurs: Evidence from the Indian Software Industry. Journal of Economics & Management Strategy, 19: 991–1012. doi: 10.1111/j.1530-9134.2010.00275.x
- Issue published online: 22 NOV 2010
- Article first published online: 22 NOV 2010
This study explores the importance of cross-border social networks for entrepreneurs in developing countries by examining ties between the Indian expatriate community and local entrepreneurs in India's software industry. We find that local entrepreneurs who have previously lived outside India rely significantly more on diaspora networks for business leads and financing. This is especially true for entrepreneurs who are based outside software hubs—where getting leads to new businesses and accessing finance is more difficult. Our results provide micro-evidence consistent with a view that cross-border social networks play an important role in helping entrepreneurs to circumvent the barriers arising from imperfect domestic institutions in developing countries.