Easier to Start, Harder to Succeed: Barriers to Black Entrepreneurship since the Great Recession

Pedro Bento and Sunju Hwang

AEA Papers and Proceedings, 2022, vol. 112, 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.

JEL-codes: E32 J15 L26 M13 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1257/pandp.20221029

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