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Does Immigration Hurt African-American Self-Employment?

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  • Robert W. Fairlie
  • Bruce D. Meyer

Abstract

Previous studies tend to find that immigration has a weak negative effect on the employment and earnings of native-born workers. These studies overlook the effect of immigration on an important sector of the labor force, the self- employed. Anecdotal evidence suggests that immigrants, especially those from Asian countries, may displace black-owned business owners. We use Census of Population microdata to examine if black self-employment levels are lower in labor markets which have a higher share of immigrants. We define labor markets as metropolitan areas (MAs) and use the variation across 94 MAs in the U.S. to examine the relationship between black self-employment and immigration in both 1980 and 1990. To control for permanent differences across MAs in other we also estimate the effect of the change in immigration from 1980 to 1990 on the change in black self-employment over this period. We generally find that immigration has no effect or only a small negative but statistically insignificant effect on black male or female self-employment. Our findings are similar if we weight immigration rates by the propensity of immigrant groups to be self-employed, if we limit our sample of immigrants to those from only Asian countries, and if we try other alternative estimation techniques and specifications.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 6265.

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Date of creation: Nov 1997
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Handle: RePEc:nbr:nberwo:6265

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References

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  1. Rachel M. Friedberg & J. Hunt, 1995. "The Impact of Immigrants on Host Country Wages, Employment and Growth," Working Papers 95-5, Brown University, Department of Economics.
  2. John M. Abowd & Richard B. Freeman, 1991. "Immigration, Trade and the Labor Market," NBER Books, National Bureau of Economic Research, Inc, number abow91-1.
  3. Timothy Bates, 1989. "The changing nature of minority business: A comparative analysis of asian, nonminority, and black-owned businesses," The Review of Black Political Economy, Springer, vol. 18(2), pages 25-42, September.
  4. George J. Borjas & Stephen G. Bronars, 1988. "Consumer Discrimination and Self-Employment," NBER Working Papers 2627, National Bureau of Economic Research, Inc.
  5. Randall Filer, 1992. "The Effect of Immigrant Arrivals on Migratory Patterns of Native Workers," NBER Chapters, in: Immigration and the Workforce: Economic Consequences for the United States and Source Areas, pages 245-270 National Bureau of Economic Research, Inc.
  6. George J. Borjas, 1986. "The Self-Employment Experience of Immigrants," NBER Working Papers 1942, National Bureau of Economic Research, Inc.
  7. Robert W. Fairlie & Bruce D. Meyer, . "Does Immigration Hurt African-American Self-Employment?," IPR working papers 97-1, Institute for Policy Resarch at Northwestern University.
  8. David Card, 1997. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," NBER Working Papers 5927, National Bureau of Economic Research, Inc.
  9. George J. Borjas & Richard B. Friedman & Lawrence F. Katz, 1997. "How Much Do Immigration and Trade Affect Labor Market Outcomes?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(1), pages 1-90.
  10. Borjas, George J. & Sueyoshi, Glenn T., 1994. "A two-stage estimator for probit models with structural group effects," Journal of Econometrics, Elsevier, vol. 64(1-2), pages 165-182.
  11. Bartel, Ann P, 1989. "Where Do the New U.S. Immigrants Live?," Journal of Labor Economics, University of Chicago Press, vol. 7(4), pages 371-91, October.
  12. Borjas, George J & Freeman, Richard B & Katz, Lawrence, 1996. "Searching for the Effect of Immigration on the Labor Market," American Economic Review, American Economic Association, vol. 86(2), pages 246-51, May.
  13. Andrew M. Yuengert, 1995. "Testing Hypotheses of Immigrant Self-Employment," Journal of Human Resources, University of Wisconsin Press, vol. 30(1), pages 194-204.
  14. Joseph Altonji & David Card, 1989. "The Effects of Immigration on the Labor Market Outcome of Less-Skilled Natives," Working Papers 636, Princeton University, Department of Economics, Industrial Relations Section..
  15. George J. Borjas, 1986. "The Self-Employment Experience of Immigrants," Journal of Human Resources, University of Wisconsin Press, vol. 21(4), pages 485-506.
  16. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
  17. Joseph G. Altonji & David Card, 1989. "The Effects of Immigration on the Labor Market Outcomes of Natives," NBER Working Papers 3123, National Bureau of Economic Research, Inc.
  18. Bruce D. Meyer, 1990. "Why Are There So Few Black Entrepreneurs?," NBER Working Papers 3537, National Bureau of Economic Research, Inc.
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Cited by:
  1. Lonnie Stevans, 2009. "The Relationship Among African American Male Earnings, Employment, Incarceration and Immigration in the United States: A Time Series Approach," The Review of Black Political Economy, Springer, vol. 36(3), pages 151-160, December.
  2. Robert W. Fairlie & Bruce D. Meyer, . "Does Immigration Hurt African-American Self-Employment?," IPR working papers 97-1, Institute for Policy Resarch at Northwestern University.
  3. Boyd, Robert L., 2003. "Were black entrepreneurs displaced from the retail trade by white immigrant merchants? A study of northern cities in the early twentieth century," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 32(4), pages 447-455, September.
  4. Stevans, Lonnie, 2007. "The Relationship Among African American Male Earnings, Employment, Incarceration and Immigration: A Time Series Approach," MPRA Paper 5594, University Library of Munich, Germany.

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