In contrast to wage and salary workers, the issue of racial and ethnic dis­ crimination among self-employed business owners has received little at­ tention from economists. As Aronson (1991, ix) observes:

Recent changes in the law, however, have made the continued constitu­ tionality of affirmative action in public sector contracting and procure­ ment contingent upon documenting the existence of racial and ethnic disparities in self-employment and business enterprise, quantifying their magnitudes, and identifying whether they indicate the presence of eco­ nomic discrimination within narrow geographic, industrial, and racial or ethnic boundaries. Given the extensive economic literature on racial dis­ crimination in other contexts, particularly wage and salary employment, economists seem well suited to assist in making such assessments. This study is devoted, in small part, to this task.