Immigrants' Pathways to Business Ownership: A Comparative Ethnic Perspective

Abstract

This paper provides a comparative perspective of pathways to entrepreneurship among Hispanic (mostly Mexican), Korean, non-Hispanic white, and Middle-Eastern/South-Asian entrepreneurs to identify common and unique circumstances conducive to business ownership. A stratified random sample business survey conducted in an immigrant neighborhood in Chicago is analyzed, to determine whether employment in a co-ethnic firm and informal self-employment serve as a stepladder to business ownership. The blocked mobility hypothesis is examined by considering self-reports about reasons for becoming self-employed. Results show that the informal economy is a common pathway to steady self-employment for Hispanics, whereas entry through employment in a co-ethnic firm was more common among Koreans than immigrants from Mexico, the Middle East, and South Asia. Koreans see business ownership as a way to overcome blocked mobility, but virtually all desire their offspring to acquire “good jobs” in the open labor market. For Hispanics, business ownership is not solely an instrument for overcoming discrimination, but rather a strategy for intergenerational mobility.

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