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Informality and Latino‐Owned Businesses: A National Portrait of Unregistered Latino‐Owned Businesses

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  • Michael J. Pisani
  • Alfonso Morales

Abstract

Objective This study provides the first nationally representative portrait of unregistered (informal) Latino‐owned businesses (LOBs) in the United States. Methods We employ data from the 2018 Stanford Latino Entrepreneurship Initiative Survey of 4,024 U.S. LOBs. We estimate the determinants of unregistered LOBs through a set of independent variables derived from entrepreneur demographics/firm characteristics utilizing a binomial logistic regression to predict the odds of group membership between (un)registered LOBs. Results Approximately one‐third of LOBs across the United States operate as unregistered enterprises. We find that LOB firm registration is associated with higher levels of education of the entrepreneur and larger size of the LOB. We uncover further links between entrepreneur acculturation and gender, and firm product offering and clientele ethnicity, with firm registration. Conclusion For the first time, we are able to establish a quantitative baseline for informality and firm registration among LOBs using a nationally representative sample.

Suggested Citation

  • Michael J. Pisani & Alfonso Morales, 2020. "Informality and Latino‐Owned Businesses: A National Portrait of Unregistered Latino‐Owned Businesses," Social Science Quarterly, Southwestern Social Science Association, vol. 101(2), pages 588-603, March.
    • Handle: RePEc:bla:socsci:v:101:y:2020:i:2:p:588-603
    DOI: 10.1111/ssqu.12763
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    Cited by:

    1. Marlene Orozco, 2020. "Reconceptualizing the Enclave: Measuring Success Among Latino‐Owned Businesses," Social Science Quarterly, Southwestern Social Science Association, vol. 101(4), pages 1374-1396, July.
    2. Estevão, João & Lopes, José Dias & Penela, Daniela, 2022. "The importance of the business environment for the informal economy: Evidence from the Doing Business ranking," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    3. Michael J. Pisani, 2021. "New Age Informality: Hispanics and the Sharing Economy," Administrative Sciences, MDPI, vol. 11(1), pages 1-23, March.
    4. Alfonso Morales, 2021. "On Farmers Markets as Wicked Opportunities," Sustainability, MDPI, vol. 13(11), pages 1-9, May.
    5. S. Andrew Starbird & Jill M. Martin & Yacanex Posadas & Alma Gutiérrez, 2022. "The Impact of Formality, Integration, and Commitment on the Performance of Latino-Owned Small Businesses," Administrative Sciences, MDPI, vol. 12(3), pages 1-16, August.

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