Abstract
Financial data on minority firms that compete for business in government and corporate set-aside programs reveal that these firms lag behind their nonminority counterparts in important respects. They are, relative to nonminorities, (1) less profitable, (2) younger, and (3) much more highly leveraged. Large-scale minority enterprises are no longer the rarity that they were 20 years ago. These firms have not, however, achieved parity with their nonminority cohorts, and their unique traits—especially undercapitalization—continue to reflect the vestiges of discrimination.
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Roy Betts and Lewis Giles, “McDonald Sees Increased Private Sector Participation in Minority Business,”Minority Business Today vol. 2, no. 4 (December 1983), p. 6.
National Institute of Government Purchasing, “Minority Business Participation in State and Local Governments,” unpublished manuscript, 1982, pp. 3–10.
Daniel Levinson, “A Study of Preferential Treatment: The Evolution of Minority Business Enterprise Assistance Programs:George Washington Law Review vol. 49 (1980), pp. 64–65.
Timothy Bates and William Bradford,Financing Black Economic Development (New York: Academic Press, 1979), pp. 131–132.
Levinson, “Preferential Treatment,” p. 76.
Timothy Bates, “Black Entrepreneurship and Government Programs,”Journal of Contemporary Studies vol. 4, no. 4 (Fall 1981), pp. 59–62.
8(a) Review Board, Small Business Administration,Report and Recommendations on the Section 8(a) Program for A. Vernon Weaver, Administrator (Washington, D.C.: Small Business Administration, 1978), p. 23.
See, for example, Bates and Bradford,Financing, chap. 9. See also Bates, “Black Entrepreneurship,” pp. 59–69.
Comptroller General,The SBA 8(a) Procurement Program: A Promise Unfulfilled (Washington, D.C.: General Accounting Office, 1981), pp. 9–19.
Levinson “Preferential Treatment,” pp. 78–79.
Data describing self-employed minorities have been taken from Timothy Bates, “An Analysis of the Minority Entrepreneur: Traits and Trends,” final report to the Minority Business Development Agency (October 1984), pp. 2–31.
A full description of the data base appears in Timothy Bates and Antonio Furino, “A New Nationwide Data Base for Minority Business,”Journal of Small Business Management vol. 23 (April 1985).
A representative sample of the major directories used to create the list of 23,000+ minority businesses includes:Dallas/Ft. Worth Buyers Guide: Dallas Regional Minority Purchasing Council (Dallas, Tex., 1980);Directory of Small Disadvantaged Businesses Located in the Great Southwest: Defense Logistics Agency, Defense Contract/ Administration Service Region (Dallas, Tex., 1981);Minority Vendors Directory: Gulf Oil Corporation (Pittsburgh, Pa., 1979);Minority Firms in MA, NY, CT, RI, ME, NH, VT: Defense Supply Agency (Boston, Mass., 1980);National Minority Business Council Business Directory: National Minority Business Council (New York, N.Y., 1980);State of California Department of Transportation Minority Business Enterprise List: State of California Department of Transportation (Sacramento, Calif., 1981);Western Electric Minority Source Directory: Western Electric (Greensboro, N.C., 1980).
Bates and Furino, “Nationwide Data Base.”
Comptroller General,8(a) Procurement, p. i.
Economic Development Administration,Local Public Works Program: Final Report (Washington, D.C., U.S. Department of Commerce, 1980), pp. 62–69.
The Granville Corporation, “A Longitudinal Analysis of Minority Business Enterprises Participating in the Local Public Works Program,” final report to the Economic Development Administration (December 1982), pp. 1—3.
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Bates, T. Impact of preferential procurement policies on minority-owned businesses. Rev Black Polit Econ 14, 51–65 (1985). https://doi.org/10.1007/BF02902609
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DOI: https://doi.org/10.1007/BF02902609