Entrepreneurship and Liquidity Constraints in Deprived Areas: Evidence
From the Slums of Rio de Janeiro

Using a survey of 4,553 entrepreneurs in 51 slums in Rio de Janeiro, the paper uses mean and quantile regression estimates to shows the effects of the type of initial capital, credit constraints, and human capital factors on entrepreneurs performance. The main findings are that entrepreneurs that were able to self-finance their business start-up presented earnings 16 percent greater than entrepreneurs that had to borrow their initial capital.