Correlation and Causation: Income Inequality and Entrepreneurship

The desire to create wealth from one\u27s own efforts is an almost universal element of the human condition. From the hawking drivers of mini buses on the streets of Cape Town, to the corporate offices of solar companies in downtown Burlington, Vermont, to the busy fruit vendors of the markets of Mexico City: wherever there is demand for goods or services, there is an entrepreneurial spirit ignited to provide the supply. Through entrepreneurship, individuals can create wealth, provide for their families, gain independence and resilience, and, perhaps most important of all, create sustainable livelihoods under self-defined terms. However, despite the rewards that succesful entrepreneurship represents there are inherent risks and challenges associated with the initial starting of each enterprise. As the aggregation of financial and social capital are increasingly concentrated to a smaller percent of the population the creation of new enterprise, by new market participants, may be impacted. This study will focus on identifying and analyzing the barriers, costs, and hindrances associated with starting a business in locales of high rates of income inequality, as measured by the Gini Coefficient. At least four communities will be selected: two in the United States and two in developing countries. A quantitative analysis of capital availability and business plans will be used to review each entrepreneur and their business, as well as a qualitative interview with each entrepreneur in each community. This research will provide key examples and add to the literature on how to create new wealth, in local hands, in the 21st century: a century that already has seen the highest rates of income inequality of recent memory