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Not for Lack of Trying: American Entrepreneurship in Black and White

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  • P. Köllinger

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  • M. Minniti

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Abstract

Using a sample obtained from a survey conducted in the United States during summer 2002, we study the variables related to observed differences in the rate of entrepreneurial involvement between black and white Americans. We find strong evidence that differences in subjective and often biased perceptions are highly associated with entrepreneurial propensity across these two racial groups. In addition, we find that black Americans tend to exhibit more optimistic perceptions of their business environment than other racial groups and are more likely than others to attempt starting a business. In fact, our results show that blacks are almost twice as likely as whites to try starting a business. Thus, our results suggest that the under representation of black Americans among established entrepreneurs is not due to lack of trying but may instead be due to stronger barriers to entry and higher failure rates. Copyright Springer 2006

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  • P. Köllinger & M. Minniti, 2006. "Not for Lack of Trying: American Entrepreneurship in Black and White," Small Business Economics, Springer, vol. 27(1), pages 59-79, August.
  • Handle: RePEc:kap:sbusec:v:27:y:2006:i:1:p:59-79
    DOI: 10.1007/s11187-006-0019-6
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    2. Aaron K. Chatterji & Kenneth Y. Chay & Robert W. Fairlie, 2014. "The Impact of City Contracting Set-Asides on Black Self-Employment and Employment," Journal of Labor Economics, University of Chicago Press, vol. 32(3), pages 507-561.
    3. Nijkamp, P. & Stough, R. & Sahin, M., 2009. "Impact of social and human capital on business performance of migrant entrepreneurs - a comparative dutch-us study," Serie Research Memoranda 0017, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    4. Neațu Alina-Maria & Imbrișcă Cosmin-Ionuț, 2015. "Entrepreneursiph In Romania. A Behavioral Economics Perspective," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 95-105, July.
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    6. Fairlie Robert & Woodruff Christopher M., 2010. "Mexican-American Entrepreneurship," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-44, February.
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    8. Zhang, Ying & Duysters, Geert, 2010. "Entrepreneurship Development and the Role of Economic Transition in Entrepreneurial Activities in China," MERIT Working Papers 036, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    9. Taehyun Ahn, 2011. "Racial differences in self-employment exits," Small Business Economics, Springer, vol. 36(2), pages 169-186, February.
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    12. Fairlie, Robert W. & Holleran, William, 2012. "Entrepreneurship training, risk aversion and other personality traits: Evidence from a random experiment," Journal of Economic Psychology, Elsevier, vol. 33(2), pages 366-378.
    13. Stephan Goetz & Anil Rupasingha, 2009. "Determinants of growth in non-farm proprietor densities in the US, 1990–2000," Small Business Economics, Springer, vol. 32(4), pages 425-438, April.
    14. Morales, Marina & Velilla, Jorge, 2018. "The effect of cultural environment on entrepreneurial decisions," MPRA Paper 83835, University Library of Munich, Germany.
    15. Magnus Lofstrom & Timothy Bates, 2013. "African Americans’ pursuit of self-employment," Small Business Economics, Springer, vol. 40(1), pages 73-86, January.
    16. Claudia Alvarez & David Urbano, 2008. "Entorno e Iniciativa Emprendedora: una Perspectiva Institucional," Working Papers 0807, Departament Empresa, Universitat Autònoma de Barcelona, revised Dec 2008.
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    20. Michael A. Abebe & Jennifer L. Welbourne, 2015. "Blessing In Disguise? Coping Strategies And Entrepreneurial Intentions Following Involuntary Job Loss," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 20(04), pages 1-22, December.
    21. Ilhan-Nas, Tulay & Sahin, Kader & Cilingir, Zuhal, 2011. "International ethnic entrepreneurship: Antecedents, outcomes and environmental context," International Business Review, Elsevier, vol. 20(6), pages 614-626.
    22. Lucy Reuben & Pamela Queen, 2015. "Capital Constraints and Industry Mix Implications for African-American Business Success," The Review of Black Political Economy, Springer;National Economic Association, vol. 42(4), pages 355-378, December.
    23. Martínez Mateo, Jesús & Mira Solves, Ignacio & Gómez Gras, José M.ª, 2013. "Influence of the economic cycle on the determinants of nascent entrepreneurial activity. An empirical analysis of the Spanish case," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 26, pages 19-45.
    24. Robert Fairlie & Justin Marion, 2012. "Affirmative action programs and business ownership among minorities and women," Small Business Economics, Springer, vol. 39(2), pages 319-339, September.
    25. Claudia Álvarez & David Urbano & José Amorós, 2014. "GEM research: achievements and challenges," Small Business Economics, Springer, vol. 42(3), pages 445-465, March.

    More about this item

    Keywords

    entrepreneurship; black entrepreneurship; minority entrepreneurship; nascent entrepreneurship; D01; J15; J23; M13;

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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