Social Networks, Ethnicity, and Entrepreneurship

61 Pages Posted: 28 Sep 2015 Last revised: 30 Oct 2015

See all articles by William Kerr

William Kerr

Harvard University - Entrepreneurial Management Unit

Martin Mandorff

Swedish Competition Authority

Multiple version iconThere are 2 versions of this paper

Date Written: September 2015

Abstract

We study the relationship between ethnicity, occupational choice, and entrepreneurship. Immigrant groups in the United States cluster in specific business sectors. For example, Koreans are 34 times more concentrated in self employment for dry cleaning than other immigrant groups, and Gujarati-speaking Indians are 108 times more concentrated in managing motels. We quantify that smaller and more socially isolated ethnic groups display higher rates of entrepreneurial concentration. This is consistent with a model of social interactions where non-work relationships facilitate the acquisition of sector-specific skills and result in occupational stratification along ethnic lines via concentrated entrepreneurship.

Suggested Citation

Kerr, William R. and Mandorff, Martin, Social Networks, Ethnicity, and Entrepreneurship (September 2015). NBER Working Paper No. w21597. Available at SSRN: https://ssrn.com/abstract=2666364

William R. Kerr (Contact Author)

Harvard University - Entrepreneurial Management Unit ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

Martin Mandorff

Swedish Competition Authority ( email )

Stockholm SE-103 85
Sweden

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