Mexican-Hispanic Self-Employment Entry: The Role of Business Start-Up Constraints
AbstractThis paper examines causes of the low self-employment rates among Mexican-Hispanics by studying self-employment entry utilizing the 1996 panel of the Survey of Income and Program Participation (SIPP). The data show that Mexican-Hispanics are less likely to be self-employed as well as entering self-employment, relative to non-Hispanic whites. Importantly, we analyze self-employment by recognizing heterogeneity in business ownership across industries and show that a classification of firms by human and financial capital “intensiveness”, or entry barriers, is effective in explaining differences in entrepreneurship across ethnic groups. We show that the lower self-employment entry rates among Mexican-Hispanics are due to lower entry rates into business ownership of firms in relatively high-barrier industries. In fact, Hispanics are more likely to start-up a business in a low-barrier industry than whites.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2422.
Length: 25 pages
Date of creation: Nov 2006
Date of revision:
Publication status: published in: Annals of the American Academy of Political and Social Science, 2007, 613 (1), 32-46
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Find related papers by JEL classification:
- J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, and Immigrants; Non-labor Discrimination
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
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