Financing Small Business Creation: The Case of Chinese and Korean Immigrant Entrepreneurs

Timothy Bates

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

Abstract: Prevailing scholarly literature misrepresents the realities of how immigrant Korean and Chinese entrepreneurs finance entry into small business. Supportive peer and community subgroups are not major sources of startup capital; the majority of all loan funds are raised by borrowing from financial institutions. The major single funding source is equity capital, which derives almost entirely from family household wealth holdings. Controlling for firm and owner traits, comparison groups of nonminority and Asian American nonimmigrant self-employed borrowers are shown to have greater access to loan sources than Korean and Chinese immigrants. High equity capital investment offsets this disadvantage. Absent rotating credit associations, and other minor debt sources, the average Korean/Chinese startup possesses substantially more financial capital than its nonminority counterparts.

Keywords: CES; economic; research; micro; data; microdata; chief; economist (search for similar items in EconPapers)
Date: 1996-09
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Financing small business creation: The case of Chinese and Korean immigrant entrepreneurs (1997)
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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:96-9

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