Internal migration experience and innovation: evidence from entrepreneurs of small and medium enterprises in China

ABSTRACT

This study examined the impact of returnee entrepreneurs’ internal migration experience on enterprise innovation and explored possible mechanisms. Using data from the 2018 Enterprise Survey for Innovation and Entrepreneurship in China (ESIEC), which collected a large sample of entrepreneurs from small and medium enterprises, the results of our study showed that entrepreneurs’ internal migration experience positively affected enterprise innovation activities and expenditure. Further, the effects were larger for the entrepreneurs who had the first migration at a younger age and had a longer duration of migration exposure. The mechanism analysis suggested that human capital accumulation was a potential channel underlying the innovation consequences of entrepreneurs’ internal migration experience.

KEYWORDS:

• Entrepreneur
• Internal migration experience
• Innovation
• Human capital
• China

JEL CLASSIFICATION:

• R23
• O31
• J24

Acknowledgements

Xiaodong Zheng acknowledges the financial support from the National Natural Science Foundation of China (Grant number: 72003173), Humanities and Social Science Fund of the Ministry of Education of China (Grant number: 20YJC790187), National Statistical Science Research Project (Grant number: 2021LY095), Natural Science Foundation of Zhejiang Province, China (Grant number: LY21G030008), the Fundamental Research Funds for the Provincial Universities of Zhejiang (Grant number: XR202206), and Tailong Finance School at Zhejiang Gongshang University.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ Questions regarding process and marketing innovation were asked for entrepreneurs of corporations rather than self-employed business. As such, the observations for these innovation outcomes were relatively smaller.

² The entrepreneurs’ skills were from self-reported or interviewer-reported questions. The details of the measurements were described in Appendix Table A1.

Additional information

Funding

The work was supported by the Natural Science Foundation of Zhejiang Province, China [LY21G030008]; National Natural Science Foundation of China [72003173]; Humanities and Social Science Fund of the Ministry of Education of China [20YJC790187]; National Statistical Science Research Project [2021LY095]; Fundamental Research Funds for the Provincial Universities of Zhejiang [XR202206]