Immigrant-owned Small Businesses’ Participation in Diaspora Philanthropy: A Case Study during the COVID-19 Outbreak

Purpose – The concept of diaspora philanthropy contains the following two components: diasporas, who are individuals who live outside of their homelands but maintain a sense of identity with their home countries, and charitable giving provided by these diasporas to causes related to their hometowns. Often diaspora philanthropy happens through intermediary organizations such as hometown associations, internet-based philanthropic platforms and faith-based groups. Little research explores immigrant-owned small businesses as intermediary organizations for diaspora philanthropy. In the literature of social entrepreneurship, the theory of opportunity recognition provides insights on how do businesses identify opportunities for fulfilling social missions. However, it is uncertain whether this major theory can be applied to a specific context such as immigrant-owned small businesses. In this research, I aim to understand immigrant-owned small businesses’ participation in social entrepreneurship through diaspora philanthropy, especially in responding to natural disasters. Specifically, three research questions were proposed: What role do small businesses play? What mechanisms do they use to partake in diaspora philanthropy? Moreover, what motivates them to participate? Design/methodology/approach – This research uses an in-depth case study that focuses on a specific diaspora philanthropy behavior in responding to a natural disaster in the diaspora’s hometown. The subject of this work is a small business owned by an immigrant in New York City, the US. To collect data on this case, the author utilized a mixed-methods design, which involves two types of qualitative data: document analysis and interview. Giving the purpose of this study, the author used thematic coding for both newspaper article data and interview data following a deductive approach. Findings – The result shows that small businesses have an inherent advantage in building close interpersonal relationships with their customers and serve as the connector between their customers and larger philanthropic organizations. Because of their limitations on resources, small businesses collaborate with larger nonprofit organizations to do complicated philanthropic work for improved capacity. When diaspora philanthropy happens due to natural disasters in homelands, diasporas experience some level of guilt since they are not there with the people of their homeland in solidarity facing the difficulties. This guilt, which is related to cultural influences, is one of the motivations that make diasporas give to their homelands. The findings also show that the opportunity recognition theory fits well into explaining the altruistic behaviors of small businesses owned by immigrants. Originality/value – A lot remains unknown about immigrant-owned small businesses, including their altruistic behaviors and participation in social entrepreneurship. This research expands the current knowledge on diaspora philanthropy by identifying the roles of small businesses, the mechanisms used by small businesses and the motivations of giving during natural disasters. This research also validates the opportunity recognition theory of social entrepreneurship in a specific context