Migrant Density, Migrant Diversity, and International Franchising: A Knowledge‐Based Perspective

Abstract

This paper explores how migrant density and diversity influence international franchising through a knowledge‐based perspective. Using data from the World Franchise Network and U.N. immigration statistics from 1993 to 2013, the study finds that higher migrant density positively impacts international franchising activities, suggesting that a substantial presence of migrants facilitates knowledge transfer and network benefits. Conversely, migrant diversity tends to have a negative effect, indicating potential challenges in harmonizing diverse knowledge bases. However, this diversity can also enhance the positive impact of migrant density on franchising, as it enriches the cultural and knowledge pool. These findings suggest that firms can leverage migrant communities for international franchising success by tapping into their networks and expertise, and that immigration policies could be tailored to support this dynamic. Managers should consider engaging with migrants to navigate cultural nuances and market entry barriers in foreign territories.