Migrant economies as new arenas to rethink policies and territorial development

Embedded economy

The concept of embedded economy is based on the understanding that people do not act in a social vacuum, but that their economic action is definitely embedded in social contexts. In the words of the economic historian Polanyi [21, p. 142] it is described as follows: “the economic system is [not] the ‘real’ society, but the economic system is part of this ‘real’ society“. The concept of embeddedness was developed by Polanyi as part of his Substantivist approach. He argues that in modern market-oriented societies, economic action is not embedded but disembedded from the social context and non-economic institutions. In line with the thinking of Polanyi, the neo-liberal perspective on economic activities, which is concentrated on the maximum individual benefit, would extremely limit the embeddedness in non-economic kinship, social and cultural institutions. In contrast to Polanyi, Granovetter [12, p. 445] applied the concept of embeddedness to modern market societies, demonstrating that even rational economic exchanges can certainly be influenced (embedded) by (in) social ties and in a complex system of kinship and moral obligations, for example, as the following quote underlines: “actors do not behave or decide as atoms outside a social context, nor do they adhere slavishly to a script written for them by the particular intersection of social categories that they happen to occupy. Their attempts at purposive action are instead embedded in concrete, on-going systems of social relations” [12, p. 487]. Nowadays, in migrant entrepreneur research the concept of embeddedness has become a crucial element. As the long history of this field of research shows, the different research approaches are situated at the interface between culturally centred approaches (which place cultural and social embeddedness centre stage) [3, 18, 22] and the more structure oriented approaches (which place the structural framework centre stage and argue for overcoming a cultural-only perspective on the phenomenon) [1]. In Europe, research on the topic has a more recent history than it has in America. This is due to the fact, that until the mid-20th century many European countries have been countries of emigration themselves. Only after the Second World War have the former emigration countries become immigration countries, albeit at a different pace and at different periods of time. As a result of these social and structural changes, and after a period of consolidation of the phenomenon, migrant entrepreneurship as a field of research has gained increased importance also within the European territory. As a consequence, Kloostermann and Rath [17] interpreted the concept of embeddedness anew for the European welfare states. They introduced the concept of the mixed embeddedness, which tries to overcome the dualism of structure and culture (individual) and leads to a more differentiated perspective on migrant entrepreneurship. The authors argue therefore for a multiple embeddedness which encompasses not only the personal, social and cultural resources but also the political and economic frameworks of the host country which slightly differs from one member state to the other. Following this line of argumentation, the direction of migration policies also differs from country to country, and is far from uniform among EU member states [23]. This is due to the fact that European member states have different immigration and emigration histories, different structures in the labour market, and different welfare states, which also have an impact on migrants, in terms of social policies, and social and economic integration [7]. An analysis of migrant entrepreneurship should therefore be very closely linked to the specific territorial context.

The framework of action between “life-world and system”

In this paper the concept of mixed embeddedness is linked to the concept of life-world and system described by Habermas [15]. This perspective is based upon a socio-scientific theoretical approach, which sees the individual always in relation to the society and includes the subject as a passive and active creator in the area of tension between structure and system [15]. It is argued, that the framework of action of migrant entrepreneurs is defined by their personal economic, social and cultural resources [4] and the enabling and preventative structures provided in the host country [17]. The concept of life-world is used in relation to the phenomenological and sociological tradition of Alfred Schütz and the social theory of Habermas. Life-world is here considered as the self-evident reality, or, in other words, as the “background” environment of competences, practices and attitudes representable in terms of one’s cognitive horizon. As Fig. 1 shows and following Cohen und Arato [5], three main actors can be described which constitute the structural framework of action: the market, the state and civil society.

The three spheres are here certainly considered as independent arenas. Drawing on Cohen and Arato [5] the relation between the three can be described as follows: “we understand “civil society“as a sphere of social interaction between economy and state, composed above all of the intimate spheres (especially the family), the sphere of associations (especially voluntary associations), social movements, and forms of public communication” [5, p. ix]. In a previous thesis by the authors, civil society and the life-world are seen as overlapping but they still represent two different realities. Against this background, migrant economies have to be understood in their hybridity at the borderline between “life-world and system” and in their ability to unveil transitions, new spaces and possibilities: “they are able to adapt their behavior to different […] contexts. They are in a between position that allows them to know how to deal with both […]. They belong to a minority group and rely on it while simultaneously establishing connections to people outside the group” [20, p. 2].

Migrant economies in policies: EU and Italy

On a European level, the political and economic discourse of migrant economies is embedded in the broader discussion of small economies in general, and the central aims of the current European immigration policy recommendations are missing this direct link. In fact, EU policy in terms of immigration is orientated towards three main issues: integration in the host country, irregular immigration and partnership between European countries [8, p. 1]. Following the Tampere program of 1999 and the Common Basic Principles for immigration policy from 2004, the major aim, defined by the European Commission, is to adopt “a holistic approach to integration” and to assist “EU States in formulating integration policies”. The European integration policy comments put emphasis on the participation of migrants at different levels (social, economic and political) pay attention especially to local activities [9]. In terms of work, integration policy at the European level is mainly orientated towards highly qualified migrants, as the “Blue Card Directive” promotes, for example, the protection of seasonal workers and the promotion of the mobility of skilled migrant workers [9, p. 2]. It is clear to see that EU immigration policy is mostly focused on the integration of migrants into the labour market as employees, and less attention is given to migrants as entrepreneurs and potential stabilizers of local communities [16]. So, migrant economies do not have a central role in integration policy, although, as Kloosterman und Rath [17, p. 1] emphasize, “by becoming self-employed, immigrants acquire quite different roles from those of immigrants, who become workers, and also from those of main stream entrepreneurs”.

In many European OECD member states, migrants have a higher work autonomy rate than locals. This affects especially the northern countries like Finland (14.1 %), Denmark (9.6 %) and other middle European Countries, such as Belgium (15,5 %) and France (10,8 %) for example. The situation is quite different, in the southern European countries like Spain, Portugal, Greece and Italy, because those economies are already based on the existence of small enterprises [19, p. 46]. Italy is a young immigration country [24, p. 19]. Prior to 1970, Italy was a country of emigration. However, since the 1980s the migration flow has constantly been growing and, as recent studies emphasize, also during the economic crisis (at least in the initial phase) immigration flow to Italy increased, rather than decreased.

For a long time, migration policy has seen migrants merely as a cheap and flexible workforce. In fact, their right to be in the country, especially since 2002, is strictly connected to their status as workers. This is related to the restrictive measures introduced by the third and current immigration law (Legge Bossi-Fini, 2002), which compels migrants to have a regular work contract, to obtain a temporary residence permit (permesso di soggiorno) a fact that has come to a head during the crisis. These measures, in conjunction with the increasing risk of unemployment [10, p. 16] have forced many migrants to accept any working conditions. In 2009, when the economic crisis was approaching its peak, the Italian Parliament adopted a major (controversial and radical) reform of immigration law (the “citizen’s security” bill) which made illegal entry a criminal offence and introduced a points-based system for the renewal of “stay permits”. Migrant entrepreneurship in Italy has to be understood against the background of the crisis in the local labour market and the systematic weakening of the status of legal immigrants. Since immigration is a structural phenomenon, entrepreneurship has always been a part of immigration in Italy. The role that migrants have in Italian society is a passive one, they are not seen as active individuals who can contribute to territorial development.

Research field

South Tyrol, the northernmost province of Italy, is one of the two autonomous provinces with a special statute. The Autonomy Statute forms the legal basis for the territory, as the backbone of the protection of the German and Ladin minorities. South Tyrol has a relatively short history of migration. Since the 1990s, the province has become a migration destination for non EU-citizens. However the province tackles the difficult co-existence between the “old” groups, and also shows that the inclusion of the so-called “new” minorities in the territory is a process, which requires a constant negotiation of new forms of co-existence. South Tyrol has always dealt with minorities. One could claim that there should be a greater understanding and the process of social inclusion should be easier than in other Italian contexts. However, the treatment of so-called “new” minorities shows the opposite. The difficulty of incorporating other minority groups in the area lies in the fact that the historic coexistence of different groups is not based on inclusion, but rather on parallelism. The difficulty of the integration of new minorities into an already ethnically defined territory is represented by the late legislation of the phenomenon. In fact, the province was one of the last territories in Italy to stipulate a territorial immigration law, doing so only in 2010.

Research instruments

The on-going PhD-research project follows an approach which aims at a reconciliation of structure and agency and moves beyond the dualism, where social structure is both the medium and the outcome of social action (see “duality of structure” [11]). Berger and Luckmann in their Social Construction of Reality [2] see the relationships between structure and agency as a dialectical one: society forms the individuals who create society. It is about linking micro-sociological and macro-sociological approaches in which “social structure is defined as both constraining and enabling of human activity as well as both internal and external to the actor” [11, p. 45].

This methodological reflection leads to the main hypothesis of the research: the step to economic independence leads on the one hand to new spaces of opportunity, which show great potential for both social and territorial development in local contexts and on the other hand it leads to new dependencies and contradictions, both at the institutional level and at the micro-level. The general aim is to understand the individual (social and economic) action strategies of migrant entrepreneurs between the life-world(s) of migrants and the dominant institutions. The paper tries to provide insight into the following research questions. Firstly, how is the phenomenon characterized in South Tyrol? Secondly, which new possibilities and new limits for migrant entrepreneurs result from the mixed-embedded economic action between life-worlds and system and, finally, how can the individual actions of migrant entrepreneurs be described (are they value-rational [wertrational] or goal-instrumental [zweckrational])? The research project is based on a participatory qualitative research project which makes use of a mixed method approach: expert interviews, narrative interviews, participant observation and data analyses. For the pilot study, statistical data were analysed and a total of three narrative interviews as well as seven expert interviews were conducted in Bressanone and Bolzano.