Influence of Family's Social Relationships on the Debt Structure of Mexican-American and Korean-American Small Businesses

Journal of Developmental Entrepreneurship, Vol. 13, No. 3, pp. 343-361, 2008

Posted: 25 Apr 2010

See all articles by George Haynes

George Haynes

University of Montana

Joseph I. Onochie

Zicklin School of Business, Baruch College CUNY

Date Written: September 1, 2008

Abstract

This study utilizes the Korean-American and Mexican-American samples in the National Minority Business Survey to examine the debt structure of small businesses owned by individuals from these ethnic groups. Small business owners with higher household net worth were more likely to borrow from finance companies, friends, and credit card companies. When controlling for business, business owner and family characteristics, Mexican-American small business owners with high net worth were significantly more likely to borrow from commercial banks than Mexican-American small business owners with low net worth are. Korean-American small business owners with high net worth were significantly more likely to utilize family loans than Korean-American small business owners with low net worth are. Korean-American small businesses appeared to be more financially dependent on the financial strength of their community, while Mexican-American small businesses owners appeared to be more financially independent.

Keywords: Family-owned small business, financial structure, ethnic differences

Suggested Citation

Haynes, George and Onochie, Joseph I., Influence of Family's Social Relationships on the Debt Structure of Mexican-American and Korean-American Small Businesses (September 1, 2008). Journal of Developmental Entrepreneurship, Vol. 13, No. 3, pp. 343-361, 2008. Available at SSRN: https://ssrn.com/abstract=1500769

George Haynes (Contact Author)

University of Montana ( email )

Missoula, MT 59812
United States

Joseph I. Onochie

Zicklin School of Business, Baruch College CUNY ( email )

17 Lexington Avenue
Dept. of Economics and Finance
New York, NY 10010
United States
212-802-6380 (Phone)
212-802-6353 (Fax)

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