Association for Public Policy Analysis & Management

This paper estimates the causal impact of a change in supply of immigrant entrepreneurs on the entrepreneurial propensities of natives using data from the Annual Social and Economic Supplement (ASEC) of the Current Population Survey (CPS). I exploit the natural experiment provided by the implementation of the State Children's Health Insurance Program (SCHIP) to address the concerns of endogeneity in the supply of immigrant entrepreneurs.  Estimates from the instrumental variable (IV) models indicate that, on average, incorporated self-employed immigrants crowd in natives into incorporated self-employment whereas unincorporated self-employed immigrants crowd out natives from unincorporated self-employment.