Financial motivations and small business survival : the effects of gender and race.
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Smith, Bethany Marie, 1987-
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It has been well established in previous literature that female and minority entrepreneurs are less successful with business ventures in comparison to whites and males. Motivation and growth expectations have also been shown to be positively associated with business success. This paper examines how differing motivations and business goals affect the disparity in business outcomes among different racial groups using data from the Second Panel Study of Entrepreneurial Dynamics (PSED II). The results varied. Stronger motivations for financial gain do appear to have a negative effect on business survival rate for black women and Hispanic men. However, for black men, non-black women and Hispanic women, the effect seems to be positive, particularly for black men and Hispanic women. When looking at the interaction between financial motivations, race and gender, various significant effects were found.