1. Dr. Shahamak Rezaei, Associate Professor Department of Society & Globalisation Roskilde University, Denmark Immigrant Entrepreneurship, Ethnic Economy, Informal Economic Activities & Undocumented Workers 16th International Metropolis Conference 12 - 16 September 2011 The Azores, Portugal

2. Financing of immigrant-owned enterprises in Denmark Research results from Financing of immigrant-owned enterprises in Denmark – opportunities and barriers - a report prepared on behalf of the Danish Ministry of Refugee, Immigration and Integration Affairs Economic framework: –Enterprise owners (immigrant or non-immigrant) act rationally upon the available options and economic incentives –Traditionally used ethnic/cultural explanations of the choices made by immigrant enterprise owners has rather limited explanatory strength and produce unconstructive perspectives

3. Number of enterprises (1998), N 0 =279 Existing enterprises (2003) z 1 =248 Closed down (2003) z 2 =31 Participating existing enterprises n 1 =135 (54,4%) Non-participa- ting existing enterprises q 1 =113 Participating closed down n 2 =18 (58,1%) Non-parti- cipating closed down q 2 =13 Survey Data I

4. Number of enterprises (1998), N 0 =279 Existing enterprises (2003) z 1 =248 Closed down enterprises (2003) z 2 =31 Participating existing enterprises n 1 =135 (54,4%) Non-participa- ting existing enterprises q 1 =113 47 enterprises have no employees Participating closed down n 2 =18 (58,1%) Non-parti- cipating closed down q 2 =13 88 enterprises have employees Of these 88: Number of Number of responses enterprises from empl. (n 3 ) Enterprises where 0 empl. participated: 21 0 Enterprises where 1 empl. participated: 53 53 Enterprises where 2 empl. participated: 14 28 Total 88 81 Survey Data II

5. Financing of immigrant enterprises Only 40% used Danish bank loans to finance enterprise Notice also differences across national origin (Survey 2003, existing enterprises, multiple responses possible)

6. Payment under the table 78% of immigrant enterprise-owners were met with demands of payments under the table when acquiring the enterprise Notice also differences across national origin (Survey 2003, existing enterprises)

7. Working undeclared 85% of those who made payments under the table now work undeclared Compare to those who did not make payments under the table: 43% work undeclared Table shows statistically significant relation between working undeclared and having met demands of payments under the table when acquiring the enterprise (Survey 2003, existing enterprises)

8. Employees’ choice of finance Survey among employees who express a wish to become an enterprise-owner: Only 25% intend to apply for Danish bank loans 91% will rely on loans from family members (Survey 2003, existing enterprises)

9. Main Research Results When financing the start-up of an enterprise, an immigrant enterprise owner is more likely to rely on his/her own savings or loans from his/her family than obtaining loans from Danish banks 4 out of 5 immigrant enterprise owners have met demands of additional payment under the table when acquiring the enterprise Those who have made payments under the table show a higher propensity to working undeclared Only 25% of the employees, who express a wish to become an enterprise owner, is expecting to use Danish bank loans as a source of finance