Low Costs & Optimism Lure Immigrant Entrepreneurs Back to India, China

Posted by: Mark Marich on May 03, 2011 Source: Policy Dialogue on Entrepreneurship

As the immigration debate continues without much hope of resolution in the near future, high-skilled immigrant entrepreneurs from India and China are turning away from the US and heading home. Leaving the US by the tens of thousands each year, they are drawn back by better economic and professional opportunities, according to a new Kauffman Foundation study highlighted in a BusinessWeek article by researcher and author Vivek Wadhwa.

The report, "The Grass is Indeed Greener in India and China for Returnee Entrepreneurs," is based on a survey of U.S.-educated Indian and Chinese professionals who had returned to their home countries and started businesses. Lower costs & employee wages were the driving factor. In India, 77 percent ranked operating costs and 72 percent ranked employee wages as very important advantages. In China, 64 percent and 61 percent, respectively, did. Other factors included: greater access to local markets; recent economic growth and political reforms in their home countries; and, personal / family networks.

But don’t call it a ‘brain drain’ just yet. The study argues that returnees “maintain close and continuing contact with friends and family, colleagues, customers, partners, and sources of business information in the United States” and that the information they share can be beneficial to entrepreneurs in the US.

The main take home? Regions that support entrepreneurial experimentation will remain important nodes in today’s global economy.

Category:  Growth & Poverty  Global  Tags:  china, india