Dolores Trevizo

Neighborhood Segregation and Business Outcomes Mexican Immigrant Entrepreneurs in Los Angeles County

With original survey data, we contribute to a discussion of how segregation and poverty affect the performance of Mexican immigrant-owned storefronts in Los Angeles. We find that though both neighborhood segregation and poverty hinder performance as measured by the number of paid employees, poverty is more important. This was true even of businesses operating for 10 or more years. Although we find some support for the “mixed economy” and “ethnic enclave” theses, we find more support for the theory of concentrated disadvantages. We conclude that the spatial segregation of Mexicans in Los Angeles hinders the performance of Mexican-owned storefronts because of the social isolation it creates and even more so because segregation concentrates poverty. We also found that both our respondents’ class background (in Mexico) and how soon they began to operate business in the formal economy (with legal capital) determines the number of paid employees they hire.

From “Illegal” to Neighborhood Shopkeeper: How Legal Capital Affects Business Performance

This chapter lays bare the intricacies of the concept of legal capital. Our evidence indicates that the timing of entrepreneurship after legalizing immigration status affects business outcomes. We suggest that net of business duration and time living in the US, the experience of operating firms in the formal economy develops business acumen and expands business networks in a way that confers small advantages on those entrepreneurs who capitalize earlier on their legal status. We submit that like other subtypes of cultural capital, legal capital refers to the cultural knowledge about the formal economy that accumulates under the auspices of legal status. We demonstrate that this knowledge—and its attendant licenses—pays more dividends to businesspeople who deploy it earlier in the course of their working lives.

Hardline Policies, Blocked Mobility, and Immigrant Entrepreneurs

This chapter focuses on shifts in immigration legislation at the turn of the twenty-first century because, as others have observed, such policy became increasingly punitive at the close of the twentieth century. The primary evidence presented in this chapter shows that in the context of growing social distancing, greater scapegoating, and blocked economic mobility, more immigrants from Mexico now turn to entrepreneurship. It is a known survivors’ strategy, even if the returns to Mexican immigrants are lower than they have historically been for other disadvantaged groups.

Gendered Differences Among Mexican Immigrant Shopkeepers

This chapter finds that women’s more conservative business strategy of purchasing existing shops, rather than starting firms from scratch, mitigates some of the disadvantages that they face. Somewhat surprisingly, we find that their odds of firm-level success improve with marriage, a result likely due to the increased financial and labor resources of a marital partner. Our intersectional analysis also finds that gender effects are class specific. Mexican immigrant women entrepreneurs whose parents were business owners performed better in business than did their more working-class counterparts. However, like the men, their small firms hired more employees when they conducted business in less segregated and less impoverished neighborhoods.

Re-producing Economic Inequality Across the US-Mexican Border

This chapter finds that neighborhood poverty reduces people’s buying power and thus undercuts the performance of the small shops owned by Mexican immigrants. As this result proves important across all chapters, it illuminates one of the mechanisms by which neighborhoods are powerful stratifying forces. A second finding of the chapter is that some families informally endow their offspring with an entrepreneurial disposition and later, as adult emigrants, those so endowed capitalize on and capture returns from their entrepreneurial cultural capital. This suggests that small socio-economic differences structured by the pre-migration class experiences of migrants, even those with low levels of education, can yield returns in the right US neighborhood context.

Mexican Segregation: Good or Bad for Business?

This chapter demonstrates that net of poverty, the extreme spatial segregation of Mexicans within neighborhoods compromises their business performance. Specifically, racial segregation undermines small businesses because too much social homophily within neighborhoods contributes to the quick saturation of markets. Neighborhoods that are more multiethnic expand demand for products, and responsive entrepreneurs can and do have better business outcomes. As such, Chap. 3 and this chapter show how disadvantaged neighborhoods put a downward pressure on the mobility trajectories of small business owners by spatially concentrating poor and racialized people. In doing so, disadvantaged neighborhoods also undermine the employment prospects of unemployed locals, further contributing to the reproduction of social class and inequality.

Conclusion: Making It in Business from the Outside-In

This chapter argues that moving into the ranks of the petite bourgeoisie is much harder for people who must overcome more than racial and gender discrimination, undocumented immigration status, or poverty. We demonstrate that while these factors are important, people live in communities that are nested in space and time. That, as we show, space and time affect the very viability of the entrepreneurship strategy suggests they also affect social mobility. Yet, precisely because disadvantaged neighborhoods create a harsh social ecology, this book offers a story of grit and survival. Some intra-ethnic differences among the immigrants in our study improved the odds of a modicum of success under these neighborhood conditions, and some intra-ethnic variation illuminates how temporality operates on their life chances.

Introduction: The Social Ecology of Disadvantage for Mexican Immigrant Entrepreneurs

Focusing on shopkeepers in Latino/a neighborhoods in Los Angeles, Dolores Trevizo and Mary Lopez reveal how neighborhood poverty relative to other stratification variables (including racial segregation and gender) affects the business performance of Mexican immigrant entrepreneurs. Their survey of Mexican shopkeepers in 20 immigrant neighborhoods demonstrates that less poor and more multiethnic communities offer better business opportunities than do the highly impoverished and racially segregated Mexican neighborhoods of Los Angeles. Their findings not only contribute to the scholarship of concentrated disadvantage that emphasizes the long-term consequences of neighborhood deprivation, but reveal previously overlooked aspects of microclass, as well as “legal capital,” advantages. The authors argue that even poor Mexican immigrants whose class backgrounds in Mexico imparted an entrepreneurial disposition can achieve a modicum of business success in the right (US) neighborhood context, and the more quickly they build legal capital, the better their outcomes. While they show that the local place characteristics of neighborhoods both reflect and reproduce class and racial inequalities, they also demonstrate that the diversity of experiences among Mexican immigrants living within the spatial boundaries of these communities also matters to their economic mobility. In sum, race, gender, legal status, and poverty affect individuals, but do so according to the ways that they are nested in space and time.