‘Ethnic economies’ on the rise in North America

January 29, 2016

By Douglas Todd, Vancouver Sun

Should a Swedish restaurant in Canada be permitted to hire only Scandinavian servers, to create a Scandinavian ambience?

Should a Mexican restaurant here have the right to employ only Hispanic staff?

Should a Chinese restaurant in North America be allowed to prioritize Mandarin-speaking staff?

Noted economist Steve Levitt was recently exploring such ethical questions. The co-author of the best-selling book, Freakonomics, said it’s tricky to determine whether restaurants and other businesses should be able to “racially profile” employees.

“I personally wouldn’t call that discrimination, or at least not the kind of discrimination to get upset about,” Levitt said. “If I have a Swedish restaurant, I want to fill it up, not just with people who are tall and blond, but who have nice Swedish accents as well, whether they’re real or fake.”

The University of Chicago economist also said if he owned a sushi or East Asian restaurant, he would want to hire East Asian-looking people. Levitt said that if he walked into a Chinese restaurant that had no Chinese-looking staff, “I bet you and I would talk about that a lot.”

The questions Levitt was dealing with — whether ethnic profiling in hiring necessarily amounts to discrimination — are germane to a rising phenomenon in North America, Europe and elsewhere, where scholars are documenting the expansion of what they call “ethnic economies.”

Ethnic economy is the umbrella term for a range of multi-billion-dollar financial activities. In their groundbreaking book, Ethnic Economies, scholars Ivan Light and Steven Gold define an ethnic economy as “any ethnic or immigrant group’s self-employed, its employers, their co-ethnic employees and their unpaid family workers.”

The term ethnic economy can sometimes also go beyond the small-business world of restaurants and hair salons to apply to major industries such as clothing manufacturers, taxi companies and construction enterprises, any business where one ethnic group of employees predominates.

Ethnic economies range from vibrant Cuban commercial hubs in Miami to sophisticated Indian financial networks in East Africa, from South Asians in the trucking industry to the more than 120 Chinese malls in suburban Toronto and the so-called “Golden Triangle” of Richmond.

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