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Immigrant entrepreneurship and the origin of bankers

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  • Eliasson, Tove

    (IBF, Uppsala University)

Abstract

Earlier research has shown that immigrant- and minority entrepreneurs have difficulties accessing capital through the formal financial markets. This essay studies what role immigrant employees within the local bank sector have for the probability of immigrants to run their own businesses. I use linked employer-employee data covering the whole Swedish labor market for the years 1987 to 2003 and utilize a nationwide refugee dispersal policy to get exogenous variation in the exposure to co-ethnic bank employees. Results suggest that there is a positive relation between co-ethnic bank employees and the probability of being self-employed. This effect is most pronounced for immigrants who arrived with low education, for males and for those residing in metropolitan regions. The effects are substantial and robust to a wide set of controls for labor market characteristics of the ethnic group at the local level. These results provides evidence of an ethnic component in the formal credit markets.

Suggested Citation

  • Eliasson, Tove, 2014. "Immigrant entrepreneurship and the origin of bankers," Working Paper Series 2014:19, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    • Handle: RePEc:hhs:ifauwp:2014_019
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    References listed on IDEAS

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    Cited by:

    1. Lisa Berntsen & Tesseltje de Lange & Ivana Kalaš & Romy Hanoeman, 2022. "Migrant Entrepreneurship Enablers: From Chance Encounters to Community Development," Work, Employment & Society, British Sociological Association, vol. 36(2), pages 271-289, April.
    2. Andersson, Henrik, 2018. "Ethnic Enclaves, Self-Employment and the Economic Performance of Refugees," Working Paper Series 2018:7, Uppsala University, Department of Economics.

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    More about this item

    Keywords

    Self-employment; immigrant entrepreneurs; capital access; information asymmetry; minority representation;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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