This study examined whether cultural determinants influence entrepreneurship by conducting an audit study of pen wholesalers in Chennai, India from different ethnic backgrounds. The study found that Marwari traders offered significantly lower prices than other wholesalers, while Andhra traders offered higher prices. Buyers from different ethnic groups also paid different prices, with Andhra buyers paying more on average. Additionally, wholesalers offered better deals to buyers from their own ethnic group. However, upfront payments did not significantly differ between matched vs unmatched ethnic groups of wholesalers and buyers. In conclusion, ethnicity appears to influence bargaining strategies and treatment of buyers, but does not alleviate hold-up problems on its own between matched groups.