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Summer 2016

ISSN 0890-913X

Volume 31, Number 2

Categories: Summer 2016 | Discrimination in employment

Does Disparity in Self-Employment Rates Imply Discrimination? An Empirical Investigation

John Lunn, Hope College

Todd Steen, Hope College

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TheJournalofPrivateEnterprise31(2),2016,41–56DoesDisparityinSelf-EmploymentRatesImplyDiscrimination?AnEmpiricalInvestigationJohnLunnHopeCollegeToddSteenHopeCollege______________________________________________________AbstractWeinvestigatewhetherdisparitiesinself-employmentratesacrossracialorethnicgroupsindicatediscrimination.Weusethe5percentPublicUseMicrodataSamples(PUMS)ofthe2000CensusofPopulationandHousingtocalculateself-employmentratesforwhites,African-Americans,Hispanics,andAsiansandfinddisparitiesbetweenwhitesandtheothergroups.However,whenweutilizespecificAsiangroupsinsteadofthebroadcategoryofAsian,somedisparitiesarepositive(Koreans,forexample).Wealsoexamineself-employmentratesforChinesebyplaceofbirthandfindsomestatisticallysignificantdisparities.Giventhattherearedisparitiesevenwhentheyarehighlyunlikelytobetheresultofdiscrimination,weconcludethatusingthedisparitiestoinferdiscriminationisnotappropriate.______________________________________________________JELCodes:J7,J150,J240Keywords:self-employment,disparity,discriminationI.IntroductionSelf-employmentratesintheUnitedStatesdifferwidelyacrossracial,ethnic,andgendercategories.Ingeneral,theself-employmentrateofmenexceedsthatofwomen,andself-employmentratesofwhitesexceedtheself-employmentratesofotherracialandethnicgroups.Someseethesedisparitiesasevidenceofdiscrimination.Forexample,Blanchflower(2009)documentssubstantialdisparitiesbetweenwhitesandminorities,andalsoarguesthatthereisevidencethatsomedisparitiescanbeattributedtodiscriminationinsmallbusinesscreditmarkets.Wainwright(2000)documentssubstantialdisparitiesinself-employmentusing1990censusdataandarguesthatthedisparitiescanbeattributedtodiscrimination.Evidenceon

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Title	Does Disparity in Self-Employment Rates Imply Discrimination? An Empirical Investigation
Authors/Creators:	John Lunn, Hope College Todd Steen, Hope College
Year:	2016
Volume:	31
Number:	2
Pages:	41 - 56
Publisher:	The Association of Private Enterprise Education
ISSN:	0890-913X
Document Type:	Articles
Keywords:	self-employment, disparity, discrimination

Citation:
Lunn, John; Steen, Todd / 2016. "Does Disparity in Self-Employment Rates Imply Discrimination? An Empirical Investigation." The Journal of Private Enterprise, 31(2): 41-56.