COMMUNITY DETERMINANTS OF IMMIGRANT SELF-EMPLOYMENT: HUMAN CAPITAL SPILLOVERS AND ETHNIC ENCLAVES

Liliana Sousa

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: I find evidence that human capital spillovers have positive effects on the proclivity of low human capital immigrants to self-employ. Human capital spillovers within an ethnic community can increase the self-employment propensity of its members by decreasing the costs associated with starting and running a business (especially, transaction costs and information costs). Immigrants who do not speak English and those with little formal education are more likely to be self-employed if they reside in an ethnic community boasting higher human capital. On the other hand, the educational attainment of co-ethnics does not appear to affect the self-employment choices of immigrants with a post-secondary education to become self-employed. Further analysis suggests that immigrants in communities with more human capital choose industries that are more capital-intensive. Overall, the results suggest that the communities in which immigrants reside influences their self-employment decisions. For low-skilled immigrants who face high costs to learning English and/or acquiring more education, these human capital spillovers may serve as an alternative resource of information and labor mobility.

Pages: 45 pages
Date: 2013-04
New Economics Papers: this item is included in nep-ent, nep-hrm, nep-iue, nep-mig and nep-ure
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Citations: View citations in EconPapers (3)

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https://www2.census.gov/ces/wp/2013/CES-WP-13-21.pdf First version, 2013 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:13-21

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