Globalization, Transnationalism and Trade

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Transcript Globalization, Transnationalism and Trade

Global Entrepreneurship and Transnationalism

By Ivan Light

Professor of Sociology University of California, Los Angeles

Once diasporas were . . .

Ethno-national communities scattered around the globe in continuous, long-term contact with one another. Hub and spokes organization with the homeland as hub Rare

Middleman minorities

Historic trading peoples who undertook commercial functions wherever they resided. Middleman minorities were organized into diasporas.


Exemplary middleman minorities

: Chinese in SE Asia Parsees of India Sikhs of East Africa Armenians of the Levant Jews of Europe and North Africa Hausa of Nigeria

Resisting Assimilation

Immigrants assimilated. Middleman minorities successfully resisted assimilation for


. Result: they were bi-cultural in mono-cultural civilizations. Retention of their ethnic culture enabled them to retain the diasporic structure for



Trading Diasporas

Middleman minorities exploited the commercial resources that their diasporic communities afforded them.

Bilingualism Quickly perceived business opportunities International social networks Enforceable Trust Business skills


Speaking their ethnic language as well as the vernacular of their country of residence, middleman minorities could communicate across linguistic barriers that stymied others.

In Turkey In Peru Turkish > Armenian > Armenian > Spanish weaver merchant merchant customer

Perception of opportunities

Living simultaneously in two or more societies, middlemen minorities readily

perceived entrepreneurial opportunities

for moving goods or services from one to the other.

International Social Networks

Thanks to the hub and spoke organization of their diasporas, middleman minorities could readily find co-ethnic trading partners abroad.

Enforceable Trust

The international social networks produced an international system of enforceable trust that subjected to sanctions any who violated the presumption of honesty.

Example: Jewish diamond merchants in Amsterdam


Business Skills

Middleman minorities acquired advanced business skills and passed them along to younger generations.

There weren’t any business schools then


Resisting assimilation is crucial

When immigrants or ethnic minorities assimilate, they lose their commercial advantages: bilingualism international social networks with enforceable trust ethnic repository of business skills advantageous perception of market opportunity

Transnationalism Now

Transnationalism provides today’s migratory ethnic minorities with most of the same diasporic advantages that were once reserved to middleman minorities.

Transnationalism’s effect


increases the number

of people who have access to the diasporic advantages that were in the past restricted to middleman minorities. Transnationalism does not suppress or replace middleman minorities.

Transnationalism, defined

When immigrants build persistent, bi-cultural diasporas that link their country of origin and their country of settlement.


are resident in at least two societies, and active participants in all at the same time.

Encouraging Transnationalism:

Instantaneous electronic communications Jet airplanes and low fares Host country multiculturalism Sending country retentionism dual citizenship Entrepreneur visas

Transnational Diasporas

Hub and spokes structure Bi-lingualism International social networks Enforceable trust



lack a cultural heritage of business skills in the historic short run

From above and below

“Transnationalism from below” refers to social conditions that result in wholesale production of transnationals among immigrant minorities. “Transnationalism from above” refers to state policies that encourage transnationalism among migratory elites.

Is transnationalism eternal?

Will transnationals resist assimilation for centuries? Possibly globalization creates a new transnational for every one who finally assimilates.

If so, transnationals ultimately assimilate, but transnationalism persists.


In the past, immigrants to the USA became monolingual in English in the third generation. Monolingualism is a litmus test of assimilation.


Globalization means the accelerated economic integration of previously less integrated national economies.

Globalization and Transnationalism Transnationals are well endowed to do the work of linking and integrating economies. bi-cultural, spoke and hub organization, international networks, enforceable trust, prompt perception of opportunity conditions

Who’s in charge?

Globalization is much bigger than transnationalism. Transnationalism is globalization’s helper.

The dominance of English

English has become the dominant language of the globalized world, esp. the business world. English is the largest language group in the world when we sum native speakers and those who acquire it as a second language.

Consequences of English dominance English-speaking business people in Turkey and Peru no longer need the intermediary help of resident Armenians in order to do business. This intermediary service was an important prop of middleman minorities’ commercial advantage and its loss undermines (but does not extinguish) the commercial advantage of transnational entrepreneurs.

Asymmetrical Effects of English dominance In the 1990s, immigration increased the


of both Canada and the United States without increasing their imports. That is, increased immigrants from country A increased Canadian and US exports to country A without increasing imports from A.

A possible explanation

Foreigners abroad now speak English so they need no help from transnational immigrants from the USA or from Canada in order to export to Canada or the USA.

Speaking English, Swedes don’t need transnational Americans in Sweden in order to export to the United States.

True, Swedes made some mistakes Vacuum cleaner advertising slogan: “Nothing sucks like Electrolux.” Jens and the “pirate ship” to Copenhagen

But conversely

Mono-lingual Americans and English speaking Canadians

need the help

of resident transnationals in order to export to their homelands. Speaking only English, Americans need the help of Swedish transnationals in the US in order to export to Sweden.

My friend Sharon C

Got nowhere exporting American cheese to Mexico until she hired a Mexican American salesman. Now he’s her partner.

Transnational Entrepreneurs

Transnational entrepreneurs in English speaking countries enjoy enhanced opportunities in the export trade thanks to their bi-cultural competence.

It’s better to be a transnational Polish entrepreneur in Canada than a transnational Canadian entrepreneur in Poland.

“The merchant speaks the customers' language” This ancient adage of international commerce is still true, and it means that mono-lingual Anglophone entrepreneurs need bi-lingual helpers in order to find/build markets abroad.

Lost in translation

Chevy Nova =

Chevy no va

= Chevy doesn’t go in Spanish

Chevrolet sales bombed in Latin America!

Global English

English dominance is now a structure, not a friction. The effects of global English dominance are asymmetrical.

One advantage

Native speakers of English enjoy an asymmetrical commercial advantage in that their foreign trade negotiations are carried on in their native language.

This situation also confers an asymmetrical advantage.

Additional advantage

The English-speaking countries also derived advantages from transnational business migrants who increased their exports without increasing their imports.

Cui bono?

Transnational entrepreneurship does not have identical economic consequences or bestow equal benefits everywhere in the world.

Conclusion 1

Transnational entrepreneurs enhance the international trade of all countries.

bi-cultural, spoke and hub organization, international networks, enforceable trust, prompt perception of opportunity conditions

Conclusion 2

The English-speaking world obtains the most benefit from immigrant transnationalism Looking out of the goldfish bowl is their unique challenge.


The case for the advantageousness of transnational entrepreneurship is somewhat weaker in non-English speaking countries than in Anglophone countries.


Ivan Light. 2007. “Global entrepreneurship and transnationalism.” Ch. 1 in

Handbook of research on ethnic minority entrepreneurship

, ed. Leo-Paul Dana. Cheltenham, UK: Edward Elgar