Building Successful Black-Owned Businesses: How Black Entrepreneurs and White Consumers Can Help Close the Racial Wealth Gap in America

Abstract

The persistent racial wealth gap between Black and White Americans stems from centuries of institutionalized racism and discrimination. Black entrepreneurship has the potential to reduce the racial wealth gap by providing a means towards upward mobility and wealth accumulation in the African-American community. As Black entrepreneurs consider locating or expanding their businesses into non-Black communities, an important question emerges: will White consumers support Black-owned businesses in majority-White neighborhoods? To explore, this study investigates the impact of making the race of a business owner salient to White consumers in Concord, New Hampshire, a majority-White community. Through surveys of Concord residents, this research finds a strong inclination among White Concord residents to support Black-owned businesses in Concord. The findings suggest that would-be Black entrepreneurs seeking to establish businesses in majority White neighborhoods in New England may find success by, among other things, strategically marketing their businesses as "Black-owned" to White consumers in these areas.