The income consequences of ethnic entrepreneurial concentrations

Based on the 1990 census data for America's 16 largest metropolitan regions , this study assesses the propensities of immigrants and minorities to beco me self-employed and concentrate in particular niches in different metropol itan regions in relation to earnings. Massive gravitation of nonmainstream groups into self-employment was found to be associated with a low earnings advantage of self-employment, particularly where the self-employed concentr ated in a few low-income traditional niches. These niches, however, could s till contribute to the economic progress of immigrants and were particularl y attractive for less-educated males. High earnings advantage of self-emplo yment, associated with high rates of self-employment, characterized several large communities located in the largest metropolitan regions, where immig rant entrepreneurs expanded from traditional specializations into a broader range of entrepreneurial niches.