Historically Black Colleges and Universities, Barriers and Entrepreneurship in Socially Disadvantaged Markets (original) (raw)
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Journal of Black Studies, 2001
While several studies have examined the impact of expenditures on graduation rates in higher education institutions, historically Black colleges and universities have strong government dependencies that suggest that these links might be different than for other universities. This paper investigates these links by estimating the production function of a subset of a large panel of 4-year institutions and uses a Chow test to find structural differences in production functions of Black universities and other universities. The analysis finds significant structural differences, notably that administrative expenditures have a significantly negative impact on graduation rates at Black universities. The findings suggest that the need to examine administrative frameworks and to diversify resource streams at Black universities is pressing. Using resource dependence theory, this paper concludes with a discussion about how these universities might mitigate the negative effects of government resource dependence.
2014
Entrepreneurship has long been the catalyst for economic growth and change. More recently, social entrepreneurship has become an area that has globally garnered attention. In the current economic environment where jobs are difficult to find, many students are opting for more entrepreneurial career options rather than choosing traditional employment paths. This is especially true for minority students where the challenge of finding suitable employment is often more difficult for many of them than their white counterparts. Consequently, increasing numbers of students have expressed interest in entrepreneurship and social entrepreneurship. The objective of this research study was to investigate the level of interest towards entrepreneurship or social entrepreneurship among students attending a Historically African American College or University. Approximately 1,005 students within the College of Business at Bowie State University were asked to participate in the study. The results of t...
Increased national attention to racial and economic inequality has created public conversation on approaches for wealth building; but far too often, entrepreneurship is not included in the conversation. Nationally, white-owned businesses without have an average of 508,405peryearinannualrevenue,comparedtoblack−ownedfirmswith508,405 per year in annual revenue, compared to black-owned firms with 508,405peryearinannualrevenue,comparedtoblack−ownedfirmswith58,119, a difference of over 8 times. Creating strategies that increase black firm revenues is critical to expand owner wealth, as well as create jobs and raise income for workers, who are more likely to be people of color. As the nation becomes increasingly diverse, promoting the scalability of non-white firms will also be critical to U.S. competitiveness. This study uses data from the Kauffman Firm Survey (KFS), a panel dataset of startup firms founded in 2004, to understand why white-black revenue gaps exist and policy solutions that can help address it, through the following questions: (A) Is there a significant difference between white and black firm revenue?; (B) What variables significantly explain the gap between white-black firm revenue?; and (C) What variables are most significantly impact a firm’s revenue? The study finds that there is a significant difference of $150,774 between white and black firms in the dataset, 9% of which can be explained by financial, human, and social capital variables. Sales to government agencies are both the most significant variable reducing the gap between white and black firms, as well as the most significant predictor of firm revenue, once time and firm fixed effects are added. The study recommends the preservation and increased adoption of race-conscious procurement policies by both the public, private, and nonprofit sectors, while also expanding access to financing opportunities and business training to help firms succeed – all of which can play a role in reducing the racial wealth gap and expanding domestic competitiveness.
2004
In this paper Butler argues that despite a stronger, group-wide emphasis on new venture creation among black Americans in the past, entrepreneurship continues to be a means of economic security and wealth creation for this group. To frame his argument, Butler examines Modes of Adjustment theory and the decline of venture development among African Americans. His emphasis is on understanding the theory's implication for black entrepreneurship and for the entrepreneurial education of future generations. Using data from both the Survey of Minority- owned Business Enterprises and Characteristics of Business Own- ers, Butler highlights the present status of black entrepreneurship to explain patterns of business and educational participation of successive generations of black Americans, from slavery onward. Butler concludes that entrepreneurship as a mode of adjustment will continue to serve as a building block for economic security, value structures, and job creation within African-A...
Higher education institutions and entrepreneurship in underserved communities
Higher Education, 2020
This study examines the experiences of business development centers in higher education institutions (HEIs) to promote entrepreneurship in underserved communities. It draws experiences and perspectives from multiple stakeholders to examine the contribution of HEIs toward equitable economic development and social renewal. Based on extensive qualitative data analyses, this study highlights the role of HEIs as anchor institutions and intermediary enablers of economic development in bridging traditionally split efforts between different university missions. The findings contribute to research and practice on entrepreneurship education and universities' engagement in fostering inclusive entrepreneurial ecosystems and equitable growth through entrepreneurship.
Entrepreneuralship in the Black Communities
Entrepreneurship is sometimes seen as a process of few peoples. Although some persons have innate abilities as entrepreneurs, many can also develop this capacity in their life through a learning process. According to Timmons (1999: 27), entrepreneurship is a way of thinking and reasoning. At the heart of entrepreneurship is the creation and/or recognition of opportunities. Therefore, entrepreneurship can help disposed people to change their social life, from poverty to wealth. In the other hand, Black Economic Empowerment (BEE) is a policy aimed at empowering previously disadvantage in South Africa. Therefore, what is the link between BEE and entrepreneurship?
Not for Lack of Trying: American Entrepreneurship in Black and White
Small Business Economics, 2006
Using a sample obtained from a survey conducted in the United States during summer 2002, we study the variables related to observed differences in the rate of entrepreneurial involvement between black and white Americans. We find strong evidence that differences in subjective and often biased perceptions are highly associated with entrepreneurial propensity across these two racial groups. In addition, we find that black Americans tend to exhibit more optimistic perceptions of their business environment than other racial groups and are more likely than others to attempt starting a business. In fact, our results show that blacks are almost twice as likely as whites to try starting a business. Thus, our results suggest that the under representation of black Americans among established entrepreneurs is not due to lack of trying but may instead be due to stronger barriers to entry and higher failure rates.
External Financing and the Survival of Black-Owned Start-Ups in the US
Eastern Economic Journal, 2014
Since black-owned businesses tend to have access to lower informal financing, we hypothesize that, obtaining commercial financing should play a compensating role and have a stronger marginal effect on black-owned businesses than on businesses owned by other racial groups. Unexpectedly, we find that, while the use of commercial financing reduces the exit rates of new firms in general, the reduction is not significantly different across racial groups. We attribute this result to unobserved heterogeneity linked, at least in part, to the owner's start-up capital and to other beneficial externalities that access to informal investors produces.
Journal of Labor Economics, Vol. 25, No. 2, …, 2007
Why Are Black-Owned Businesses Less Successful than White-Owned Businesses? The Role of Families, Inheritances, and Business Human Capital * Four decades ago, Nathan Glazer and Daniel Patrick Moynihan made the argument that the black family "was not strong enough to create those extended clans that elsewhere were most helpful for businessmen and professionals." Using data from the confidential and restricted access Characteristics of Business Owners Survey, we investigate this hypothesis by examining whether racial differences in family business backgrounds can explain why black-owned businesses lag substantially behind white-owned businesses in sales, profits, employment size and survival probabilities? Estimates from the CBO indicate that black business owners have a relatively disadvantaged family business background compared with white business owners. Black business owners are much less likely than white business owners to have had a self-employed family member owner prior to starting their business and are less likely to have worked in that family member's business. We do not, however, find sizeable racial differences in inheritances of business. Using a nonlinear decomposition technique, we find that the relatively low probability of having a self-employed family member prior to business startup among blacks does not generally contribute to racial differences in small business outcomes. Instead, the lack of prior work experience in a family business among black business owners, perhaps by limiting their acquisition of general and specific business human capital, negatively affects black business outcomes. We also find that limited opportunities for acquiring specific business human capital through work experience in businesses providing similar goods and services contribute to worse business outcomes among blacks. We compare these estimates to contributions from racial differences in owner's education, startup capital, geographical location and other factors.