Entrepreneurship and Labor Absorption: Blacks and Whites in Northern U.S. Cities During the Great Depression

An extensive literature on newly developing societies shows that the urban economy's entrepreneurial sector can absorb a sizable share of persons who are unemployed and searching for work. Surprisingly, however, little research on the United States has examined entrepreneurship's labor absorption capacity. The present study fills this gap by analyzing Blacks and Whites in northern U.S. cities during the Great Depression, a time of widespread joblessness, particularly among Blacks. The results suggest that, if not for Blacks’ uniquely severe resource deprivation, Black entrepreneurship could have absorbed a large number of jobless Blacks. Labor absorption estimates, calculated with 1940 Census data, indicate that one-third of the Black-White unemployment difference is attributable to racial inequality of entrepreneurial outcomes. This historical evidence advances social-scientific understanding of racial inequality during the Great Depression and informs a longstanding debate about the merits of promoting Black business ownership as a strategy for improving Blacks’ labor market prospects.

Entrepreneurship and the Racial Wealth Gap: The Impact of Entrepreneurial Success or Failure on the Wealth Mobility of Black and White Families

Research has repeatedly argued that increasing the rate at which Black people start businesses could reduce the racial wealth gap between Black and white families, but increasing the rate of Black entrepreneurship may actually exacerbate the racial wealth gap, due to the economic cost associated with business closure. Using longitudinal data from the Panel Study of Income Dynamics (PSID), we find that, as past work suggests, Black-owned businesses are less likely to remain open 4 years later, compared to white-owned businesses, and that, due to this disparity, Black business owners are more likely to experience downward economic mobility and less likely to experience upward mobility, compared to their white counterparts. These results suggest that improving the rate at which Black entrepreneurs succeed, rather than increasing the rate at which Black people become entrepreneurs, should be the target of efforts to leverage business ownership to reduce the racial wealth gap.

Lawyers as Social Engineers: How Lawyers Should Use Their Social Capital to Achieve Economic Justice

The Michigan Business & Entrepreneurial Law Review (MBELR) has always strived to provide a platform for legal scholars, professionals, and students to publish business-related legal scholarship. Yet, little legal business scholarship focusing on the Black business community exists, despite the extraordinary impact that Black communities have in the U.S. business landscape. In a year of revolutionary social change, we are excited to feature in this special issue the work of Professor Dana Thompson, a Michigan Law alumna, in an effort to remedy this gap. Professor Thompson’s career, professional values, and day-to-day work demonstrate genuine, commanding, and inspiring commitment to social justice and community-based organizations.

Available but Not Approachable: Black Business Students’ Interactions with Faculty at a Historically White Institution

Persistent racial inequities in educational attainment and employment negatively affect the economic mobility of the Black population in the United States. Among college graduates, Black people are underrepresented in most high-paying college majors, except for business. In this phenomenological study framed by Critical Race Theory, Black business students (n=10) at a Historically White Institution shared their perceptions of the climate and experiences of interactions with faculty. Students reported they often felt unwelcome and othered in the White-dominated space and received limited support from White faculty that were frequently “available but not approachable”. Future research and practice should focus on institutional strategies to address racism by developing an equitable and welcoming business school culture and fostering cultural competence of faculty.

A “Body of Business Makers”: The Detroit Housewives League, Black Women Entrepreneurs, and the Rise of Detroit’s African American Business Community

This article examines the Detroit Housewives League (DHL) in the 1930s and 1940s, concentrating on DHL members’ actions as businesswomen. Past narratives have framed the DHL as an extension of the black women’s club movement or as part of the women-driven consumer movements of the 1930s and 1940s, particularly highlighting the organization’s philosophies on black women’s purchasing power. I argue that entrepreneurial DHL women brought prior business knowledge to their organizing and were significant business experts and leaders. By conducting business research, forging community networks, and, significantly, establishing commercial colleges and other forms of business education in the city, DHL members’ work was vital for the black business community as a whole and for women entrepreneurs in particular. In reframing the DHL as an organization established by black entrepreneurial women, I suggest scholars should reevaluate black women’s contributions to other forms of activism in order to recover additional histories of black women’s entrepreneurship and business leadership.

Lending a Hand: Black Business Owners’ Complex Role in the Civil Rights Movement

This article explores the powerful ways in which black business owners supported the Civil Rights movement. Business owners such as Leah Chase, Gus Courts, A. G. Gaston, and Amzie Moore, among others, contributed resources and organizational skills to the fight for racial justice. But the relationship between business owners and activists within the movement was at times characterized by tension. Although business owners sometimes found the approach of activists to be too radical and activists sometimes found the business owners’ approach to be too conservative, they found ways to compromise in order to work cooperatively toward racial justice.