Ethnicity and Self-Employment in Trinidad and Tobago : An Empirical Assessment

In Trinidad and Tobago, the Chinese, Syrian-Lebanese and White ethnic groups have the highest levels of self-employment, while Indians have emerged as the new business class. However, relatively few black Trinidadians are self-employed. Using survey data, this study examines whether these apparent differences in self-employment rates can be explained by differences in attributes, or must be explained by other factors like ethnic inclination/disinclination due to historical/sociological factors. We find substantial differences in the self-employment rates of the various ethnic groups, with black Trinidadians having the lowest rates, Indians and mixed Trinidadians have the second highest, and the Chinese, Syrian-Lebanese and whites having the highest probability of being self-employed of all ethnic groups. These differences in the probability that members of a given ethnic group will be self-employed persist even after controlling for individual characteristics that also affect the self-employment choice. We conclude with a discussion of the various historical/sociological factors that might explain differences in ethnic self-employment rates including the effects of colonisation, the importance that each group places on family ties, and each groups' appraisal of its status and opportunities relative to the other ethnic groups in the country