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September 11 and the Rise of Necessity Self-Employment Among Mexican Immigrants

Chunbei Wang () and Magnus Lofstrom
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Chunbei Wang: The University of Oklahoma
Magnus Lofstrom: Public Policy Institute of California

Eastern Economic Journal, 2020, vol. 46, issue 1, No 2, 5-33

Abstract: Abstract Since the September 11 attacks (9/11), the USA has seen a tightening of immigration policies. Previous studies find that stricter immigration enforcement has the unintended effect of pushing undocumented immigrants into self-employment. This paper builds on the literature to better understand the changes in the types of self-employment among Mexican immigrants triggered by the tightened immigration enforcement after 9/11. Using a difference-in-differences approach, and the recently developed measures by Fairlie and Fossen (Opportunity versus necessity entrepreneurship: two components of business creation, 2018) to distinguish between necessity and opportunity self-employment, we find that both necessity and opportunity self-employment increased among Mexican immigrants after 9/11. However, the effect is most prominent on necessity self-employment, consistent with the hypothesis that they are pushed into self-employment as a survival alternative.

Keywords: Mexican immigrants; Self-employment; 9/11; Tightened immigration policies; Necessity; J15; L26 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1057/s41302-019-00142-7

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