Asian Discrimination in the Coronavirus Era: Implications for Business Formation and Survival

Catalina Amuedo-Dorantes, Cristina Borra and Chunbei Wang

No 14182, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: With the onset of the Covid-19 pandemic, Asians became the victims of a sudden increase in racial discrimination as public officials repeatedly referred to the virus as the "Chinese virus." We document that Asian entrepreneurship has been disproportionally hurt after January 2020, particularly among Asian immigrants, declining by 17 percent when compared to non-Hispanic whites. Examining the dynamics of transitions into and out of self-employment, we find a substantial increase in Asian immigrants' self-employment exits, increased necessity entries, and reductions in opportunity entries – patterns suggestive of customer and employer 'taste discrimination'. The pandemic has also proven particularly harmful on businesses owned by recently arrived immigrants and by East Asian immigrants. While Asian enclaves help palliate the pandemic's damaging impact, the latter has reached a broad spectrum of businesses. Gaining a better understanding of how the pandemic has impacted Asian businesses is crucial to inform about the emergence of discriminatory behaviors that widen inequities and endanger a fast recovery.

Keywords: asian; discrimination; COVID-19; business ownership; business dynamics (search for similar items in EconPapers)
JEL-codes: J15 J61 J71 J78 (search for similar items in EconPapers)
Pages: 53 pages
Date: 2021-03
New Economics Papers: this item is included in nep-ent, nep-lab and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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