Activist homophily, activist signaling, and the acquisition of social capital by Black entrepreneurs: a field experiment

Black entrepreneurs in the United States are notably disadvantaged relative to their White counterparts. This disadvantage primarily stems from differential access to resources (Bates, Bradford, & Seamans, 2018). Although scholars have closely attended to differentials in the acquisition of financial capital by Black entrepreneurs (e.g., Fairlie, Robb, & Robinson, 2022; Younkin & Kuppuswamy, 2018), less attention has been given to differentials in the acquisition of social capital, or durable networks of social relationships granting access to actual and potential resources (Bourdieu, 1986). However, social capital is an important resource for entrepreneurs (Gedajlovic et al., 2013), and it is a form of capital particularly sensitive to racial dynamics (Putnam, 2007).

To explore the relationship between race and the acquisition of social capital by entrepreneurs, we offer a series of hypotheses tested in the context of LinkedIn, the most used professional social network in the United States. Entrepreneurs used LinkedIn to acquire social capital, such as mentors, potential collaborators, and fellow entrepreneurs. Furthermore, because there is a strong norm for the inclusion of a headshot photograph, race is very salient in the context of LinkedIn.