All Entrepreneurs are Equal but Some are More Equal than Others

Siraz, Sonia and Claes, Björn Paul (2022). All Entrepreneurs are Equal but Some are More Equal than Others. In: Academy of Management Annual Conference, 5-9 Aug 2022, Seattle, Washington, USA.

DOI: https://doi.org/10.5465/AMBPP.2022.12853abstract

Abstract

This paper sheds light on how ethno-racial stereotypes affect legitimacy perceptions about entrepreneurs. Our findings show that compared to nonminority entrepreneurs, minority entrepreneurs are perceived as less legitimate due to their ethno-racial attributes. Our study confirms the presence of an ethno-racial hierarchy among different minority groups that increases the harshness of legitimacy perceptions for lower status minority groups. Entrepreneurs’ higher level of education alleviates some of those inequalities but fails to eliminate them completely. We demonstrate that observers’ beliefs in a just world play a fundamental role in mitigating or increasing the harshness of legitimacy perceptions. Through three conjoint experiment studies, totaling 22,608 evaluations nested in 1,413 observers from the general public in the United States, we examine how entrepreneurs from two minority groups, Black Americans and Latinx, are judged relative to nonminority entrepreneurs (White Americans) after their endeavors have failed. We then further examine whether there are differences when these two groups of minority entrepreneurs are judged relative to each other. This study contributes to a deeper understanding of how system inequality and prejudice endure in business.

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