ABSTRACT
Latinos’ increasing presence in the middle and upper classes in the USA (Agius Vallejo 2012; Jimenez 2010; Vasquez 2011) and the fact that some are accumulating high levels of wealth through business ownership (Valdez 2011), might be a harbinger of Latino philanthropy directed at ethnic communities as some affluent Latinos retain an ethos of giving back to family and community (Agius Vallejo 2012). However, whether successful Latino business owners give back to low-income Latino communities has not been carefully examined and documented. The central question of this research is do Latino entrepreneurs cut ties to ethnic
communities once they attain middle-or upper-class status or do they maintain a sense of ethnic solidarity expressed through community giving that is aimed at promoting the mobility of co-ethnics? Three questions guide this analysis. First, do successful Latino business owners retain ties to ethnic communities? Second, to what extent do successful Latino business owners give back to the community? Finally, what are Latino business owners’ motivations for giving back? Examining successful Latino business owners’ patterns of giving back is important
for several reasons. First, the number of Latino businesses increased 44% between 2002 and 2007-more than double the 18% increase in the total number of small businesses nationwide (US Survey of Business Owners 2007). This increase outpaced the growth rate of the Hispanic population, which grew 36% in almost the same time period (US Census). We know little about successful Latino entrepreneurs because scholars primarily examine low-class Latino entrepreneurs who are touted as owning small subsistence-only businesses in ethnic enclaves (Farlie and Robb 2008). Second, Latino communities are generally portrayed as lacking social capital (Baca Zinn and Wells
Ethnic and Racial Studies, 2015 Vol. 38, No. 1, 125-140, https://dx.doi.org/10.1080/01419870.2013.848288
Latinos’ increasing presence in the middle and upper classes in the USA (Agius Vallejo 2012; Jimenez 2010; Vasquez 2011) and the fact that some are accumulating high levels of wealth through business ownership (Valdez 2011), might be a harbinger of Latino philanthropy directed at ethnic communities as some affluent Latinos retain an ethos of giving back to family and community (Agius Vallejo 2012). However, whether successful Latino business owners give back to low-income Latino communities has not been carefully examined and documented. The central question of this research is do Latino entrepreneurs cut ties to ethnic
communities once they attain middle-or upper-class status or do they maintain a sense of ethnic solidarity expressed through community giving that is aimed at promoting the mobility of co-ethnics? Three questions guide this analysis. First, do successful Latino business owners retain ties to ethnic communities? Second, to what extent do successful Latino business owners give back to the community? Finally, what are Latino business owners’ motivations for giving back? Examining successful Latino business owners’ patterns of giving back is important
for several reasons. First, the number of Latino businesses increased 44% between 2002 and 2007-more than double the 18% increase in the total number of small businesses nationwide (US Survey of Business Owners 2007). This increase outpaced the growth rate of the Hispanic population, which grew 36% in almost the same time period (US Census). We know little about successful Latino entrepreneurs because scholars primarily examine low-class Latino entrepreneurs who are touted as owning small subsistence-only businesses in ethnic enclaves (Farlie and Robb 2008). Second, Latino communities are generally portrayed as lacking social capital (Baca Zinn and Wells
Ethnic and Racial Studies, 2015 Vol. 38, No. 1, 125-140, https://dx.doi.org/10.1080/01419870.2013.848288
2000; Portes and Zhou 1993) – the ability to mobilize resources and networks based on group membership (Coleman 1988; Portes and Sensenbrenner 1993) – resulting in a dearth of networks and ethnic social structures that can guard against downward or stagnated assimilation and advance the mobility of co-ethnics. In this vein, research on ethnic enterprise has been most concerned with what makes specific immigrant groups succeed or fail in day-to-day business operations rather than non-business activities and its effects on the social processes and mechanisms that foster community building, social capital and group mobility. This has resulted in a substantial conceptual gap regarding how entrepreneurs’
philanthropic activities affect ethnic communities (Zhou 2004). This research is important because successful Latino entrepreneurs may make an impact at the community level by infusing the community with financial and social capital that promotes upward mobility. Finally, low-income Latino communities are severely underfunded. A 2011 report by the Foundation Center finds that between 1999 and 2009, Latino communities received just one cent from every dollar distributed by funders (i.e. independent, corporate and community foundations). Thus, if they do give back, middle-and upper-class Latino entrepreneurs – the Latino elite – may help to close social and economic capital gaps in Latino communities and help to accelerate Latino mobility into the middle class. This study draws on forty-five in-depth interviews with Latino entrepreneurs in Los
Angeles, California and ten interviews with people active in Los Angeles’ Latino business community (i.e. politicians, non-profit directors, corporate executives). Los Angeles is a natural social laboratory for studying Latino enterprise because Latinos comprise nearly half of Los Angeles’ population; California is home to a quarter of all Latino-owned firms in the nation, the largest concentration of any state; and Latinos own 20% of all firms (359,885) in the Los Angeles region, more than any other minority group (US Survey of Business Owners 2007).
