To evaluate our very own hypotheses, i work with a few regressions by using the investigation discussed significantly more than. This new regressions was of pursuing the means:
getting loan individual i when you look at the postcode z. The main independent adjustable of interest Black are a sign getting perhaps the mortgage receiver self-stated while the Black. We include many company peak, mortgage peak, and you will zip code height control details X, as well as gender, experienced standing, perform said, and you may dummy variables to possess business (at the dos-fist NAICS password peak) and state. Investigation to your perform stated are an important control to possess variance in business proportions that can be correlated to the race out-of company citizens https://paydayloansohio.net/cities/tipp-city/. Black-owned enterprises are smaller sizes and their a lot fewer workers (Tareque ainsi que al., 202step 1). Since PPP financing number are a function of enterprise payroll, we could possibly anticipate reduced firms to help you qualify for reduced fund. By controlling to own stated work, we could imagine an average difference in loan wide variety given to Black-and-white companies of equivalent size.
It is also important to control for industry level effects, given evidence that the pandemic has differentially affected sectors of the economy. For example, data from Yelp suggests that retail establishments have struggled to stay open, whereas professional service establishments such as law firms and accountants have not.