Revised City of South Bend Disparity Study Report

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City of South Bend Disoarity Study 2020 denied business ownership through either de jure segregation or de facto exclu- sion. There is evidence that current racial patterns of self-employment are in part determined by racial patterns of self-employment in the previous generation. 161 Black men have been found to face a "triple disadvantage": they are less likely than White men to: 1. Have self-employed fathers; 2. Become self-employed if their fathers were not self-employed; and 3. To follow their fathers into self- employment. 162 Intergenerational links are also critical to the success of the businesses that do form. 163 Working in a family business leads to more successful firms by new own- ers. One study found that only 12.6 percent of Black business owners had prior work experiences in a family business as compared to 23.3 percent of White busi- ness owners. 164 This creates a cycle of low rates of minority ownership and worse outcomes being passed from one generation to the next, with the corresponding perpetuation of advantages to White -owned firms. Similarly, unequal access to business networks reinforces exclusionary patterns. The composition and size of business networks are associated with self-errtploy- ment rates. 165 The U.S. Department of Commerce has reported that the ability to form strategic alliances with otherfirms is important for success. 166 MBEs in our interviews reported that they felt excluded from the networks that help to create success in the highway construction industry. F. Conclusion The economy -wide data, taken as a whole, paint a picture of systemic and endemic inequalities in the ability of firms owned by minorities and women to have full and fair access to City contracts and associated subcontracts. This evi- dence supports the conclusion that absent some affirmative City measures, these inequities create disparate impacts on M/WBEs and may render the City of South Bend a passive participant in overall market -wide discrimination. 161. Fairlie, R W., 'The Absence of the African American Owned Business, An Analysis of the Dynamics of Self -Employment," Journal of Labor Economics, (1999). 162. Haut, M. and Rosen, H. S., "Self-employment, Family Background, and Race," Journal of Human Resources 35, no.4 (2000). 163. Fairlie, R.W. and Robb, A., "Why are black -owned businesses less successful than White -owned businesses? The role of families, inheritances, and business human capital," Journal of Labor Economics, (2007). 164. Id. 165. Allen, W. D., "Social Networks and Self -Employment," JournolofSocio-Economics 29, no.5 (2000). 166. Increasing MBE Competitiveness through strategic Alliances (Minority Business Development Agency, 2008). 92 0 2020 Colette Holt & Associates, All Rights Reserved.