Whose Job is it Anyway? Co-Ethnic Hiring in New U.S. Ventures

We explore co-ethnic hiring among new ventures using U.S. administrative data. Co-ethnic hiring is ubiquitous among immigrant groups, averaging about 22.5% and ranging from 40%. Co-ethnic hiring grows with the size of the local ethnic workforce, greater linguistic distance to English, lower cultural/genetic similarity to U.S. natives, and in harsher policy environments for immigrants. Co-ethnic hiring is remarkably persistent for ventures and for individuals. Co-ethnic hiring is associated with greater venture survival and growth when thick local ethnic employment surrounds the business. Our results are consistent with a blend of hiring due to information advantages within ethnic groups with some taste-based hiring. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.