Easier to Start, Harder to Succeed: Barriers to Black Entrepreneurship since the Great Recession
AEA Papers and Proceedings
vol. 112,
May 2022
(pp. 292-95)
Abstract
We use a structural framework to interpret trends related to Black entrepreneurship, and infer how race-specific barriers faced by Black entrepreneurs have changed since the Great Recession. While all barriers declined consistently before the Recession, we find only the cost of starting a firm has declined since, relative to the cost faced by non-Black entrepreneurs. Since the Recession, Black entrepreneurs have experienced sharply increasing costs of employing labor and capital, and declining demand relative to other entrepreneurs. As a result, convergence in entrepreneurship rates has stalled.Citation
Bento, Pedro, and Sunju Hwang. 2022. "Easier to Start, Harder to Succeed: Barriers to Black Entrepreneurship since the Great Recession." AEA Papers and Proceedings, 112: 292-95. DOI: 10.1257/pandp.20221029Additional Materials
JEL Classification
- E32 Business Fluctuations; Cycles
- J15 Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
- L26 Entrepreneurship
- M13 New Firms; Startups