IDEAS home Printed from https://ideas.repec.org/a/sae/ecdequ/v9y1995i1p3-14.html
   My bibliography  Save this article

Why do Minority Business Development Programs Generate so Little Minority Business Development?

Author

Listed:
  • Timothy Bates

    (Wayne State University)

Abstract

Minority enterprise assistance programs are largely failures. They are flawed in intent, design, and implementation. Current minority business enterprise (MBE) loan programs share three flaws: (1) Lending is targeted to overcrowded lines of business with low profits, (2) tiny loans flow to marginally viable firms, and(3) consequent high-loan default rates erode funds available for relending. Three types of problems must be dealt with if MBE assistance is to be a useful tool for generating economic development: (1) Geographic targeting of MBE assistance to poor ghetto neighborhoods should be sharply reduced, (2) targeting aid to low-income individuals should be eliminated, and (3) poorly administered programs that destroy MBEs and encourage fraud should be reformed or eliminated.

Suggested Citation

  • Timothy Bates, 1995. "Why do Minority Business Development Programs Generate so Little Minority Business Development?," Economic Development Quarterly, , vol. 9(1), pages 3-14, February.
    • Handle: RePEc:sae:ecdequ:v:9:y:1995:i:1:p:3-14
    DOI: 10.1177/089124249500900101
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/089124249500900101
    Download Restriction: no
    File URL: https://libkey.io/10.1177/089124249500900101?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marshall, Maria I. & Peake, Whitney O., 2006. "What Do We Really Know About Entrepreneurs? An Analysis Of Nascent Entrepreneurs In Indiana," Staff Papers 28622, Purdue University, Department of Agricultural Economics.
    2. William D. Bradford, 2014. "The “Myth†That Black Entrepreneurship Can Reduce the Gap in Wealth Between Black and White Families," Economic Development Quarterly, , vol. 28(3), pages 254-269, August.
    3. Manuel Carvajal, 2006. "Economic grounds for affirmative action: The evidence on architects and engineers in South Florida," Review of Social Economy, Taylor & Francis Journals, vol. 64(4), pages 515-538.
    4. Lisa J. Servon, 2006. "Microenterprise Development in the United States: Current Challenges and New Directions," Economic Development Quarterly, , vol. 20(4), pages 351-367, November.
    5. Wellalage, Nirosha Hewa & Reddy, Krishna, 2020. "Determinants of profit reinvestment undertaken by SMEs in the small island countries," Global Finance Journal, Elsevier, vol. 43(C).
    6. James J. Chrisman & Jess H. Chua & Lloyd P. Steier, 2002. "The Influence of National Culture and Family Involvement on Entrepreneurial Perceptions and Performance at the State Level," Entrepreneurship Theory and Practice, , vol. 26(4), pages 113-130, July.
    7. Timothy Bates, 2009. "Utilizing Affirmative Action in Public Sector Procurement as a Local Economic Development Strategy," Economic Development Quarterly, , vol. 23(3), pages 180-192, August.
    8. Kevin Mole & Joan-Lluís Capelleras, 2018. "Take-up and variation of advice for new firm founders in different local contexts," Environment and Planning C, , vol. 36(1), pages 3-27, February.
    9. Christy, Ralph D. & Wenner, Mark D. & Dassie, Wylin, 2000. "A Microenterprise-Centered Economic Development Strategy For The Rural South: Sustaining Growth With Economic Opportunity," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 32(2), pages 1-14, August.
    10. Mark Schreiner, 1999. "Lessons for Microenterprise Programs from a Fresh Look at the Unemployment Insurance Self-Employment Demonstration," Evaluation Review, , vol. 23(5), pages 504-526, October.
    11. Jack I. Richter & Pankaj C. Patel, 2022. "Impact of the COVID-19 pandemic on the hours lost by self-employed racial minorities: evidence from Brazil," Small Business Economics, Springer, vol. 58(2), pages 769-805, February.
    12. Tendler, Judith & Amorim, Monica Alves, 1996. "Small firms and their helpers: Lessons on demand," World Development, Elsevier, vol. 24(3), pages 407-426, March.
    13. Lisa J. Servon, 1997. "Microenterprise Programs in U.S. Inner Cities: Economic Development or Social Welfare?," Economic Development Quarterly, , vol. 11(2), pages 166-180, May.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:ecdequ:v:9:y:1995:i:1:p:3-14. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.