U.S. Small Business of Administration (SBA) Office of. Advocacy ...... Communities,â was written by Robert K. Perkins of the University of Arkansas at. Pine Buff.
ABSTRACT
Title of dissertation:
BLACK ENTREPRENEURSHIP: LITERATURE AND REALITY.
Micah E. S. Crump, Doctor of Philosophy, December 2008
Dissertation chaired by:
Robert P. Singh, Ph.D. Department of Business Administration
This dissertation provides two major contributions to the entrepreneurship literature. First, it provides the first comprehensive survey of the papers published on black entrepreneurship that are contained in the literature. Second, it provides rankings of the most prolific researchers and affiliations publishing in two areas: on black entrepreneurship; and by Historically Black Colleges and Universities. Additional contributions are the dissertation’s supplementary findings that rank researchers and institutions by their quantitative publication on entrepreneurship in general, and on opportunity recognition: an important research component of the entrepreneurship process.
BLACK ENTREPRENEURSHIP: LITERATURE AND REALITY by Micah E. S. Crump
A Dissertation Submitted in Fulfillment of the Requirements for the Degree Doctor of Philosophy
MORGAN STATE UNIVERSITY September 2008
UMI Number: 3349914
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BLACK ENTREPRENEURSHIP: LITERATURE AND REALITY by Micah E. S. Crump
has been approved
September 2008
DISSERTATION COMMITTEE APPROVAL:
____________________________, Chair Robert P. Singh, Ph.D.
____________________________ Augustus Abbey, Ph.D.
____________________________ Anthony D. Wilbon, Ph.D.
____________________________ Xingxing Zu, Ph.D.
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TABLE OF CONTENTS
SECTION 1.0
INTRODUCTION….....................................................…………..1
SECTION 2.0
LITERATURE REVIEW.............................................................19
SECTION 3.0
RESEARCH METHODOLOGY..................................................59
SECTION 4.0
SURVEY OF THE BLACK ENTREPRENEURSHIP LITERATURE.....................................67
SECTION 5.0
SURVEY OF THE ENTREPRENEURSHIP LITERATURE PUBLISHED BY HBCUs...........................................................79
SECTION 6.0
SUMMARY: SURVEY OF THE BLACK ENTREPRENEURSHIP LITERATURE....................................95
SECTION 7.0
RANKINGS OF TOP ENTREPRENEURSHIP RESEARCHERS AND AFFILIATIONS...................................120
SECTION 8.0
EXAMINING OPPORTUNITY RECOGNITION RESEARCH OUTPUT SINCE 1995.......................................136
SECTION 9.0
CONCLUDING REMARKS.....................................................160
SECTION 10.0 REFERENCES.......................................................................173 APPENDIX A
SUMMARIES OF BLACK ENTREPRENEURSHIP PAPERS..........................................190
APPENDIX B
TOP 100 AUTHORS - IN GENERAL.....................................214
APPENDIX C
TOP 100 AFFILIATIONS - IN GENERAL...............................220
APPENDIX D
TOP 100 AUTHORS – IN OPPORTUNITY RECOGNITION.....................................................................224
APPENDIX E
TOP 100 AFFILIATIONS – IN OPPORTUNITY RECOGNITION......................................................................228
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DETAILED TABLE OF CONTENTS SECTION 1.0 1.1 1.2 1.3 1.4
INTRODUCTION….....................................................…………..1
Black entrepreneurship: A solution and the reality………………….…….…5 The need for more research on black entrepreneurs…………….….…….…7 Research Objectives………………………………………………….……..…12 Organization of Study………………………………………………….……....15
SECTION 2.0
LITERATURE REVIEW.............................................................19
2.1 Introduction…………..……………….……………………………………….…19 2.2 What is Known About Black Entrepreneurship…………...……………….…21 2.2.1 Blacks score high on ntrepreneurialpropensity……….…..……21 2.2.2 Blacks are under-resourced: Capital, community and network support, education……23 2.3 Unaddressed Research Questions about Black Entrepreneurship …….29 2.3.1 Factors that Impact Rates of Black Entrepreneurship Exploitation …………………29 • Black opportunity recognition and lower lucrative value……....29 • Challenges related to securing venture capital…………………30 • Low trust and network structural differences among black entrepreneurs………………32 2.3.2 Black Urban Entrepreneurship……………..………………….…35 • Urban retail scarcity………………….……………………….…..35 • How urban market characteristics affect black entrepreneurs ……….……40 2.3.3 Black Entrepreneurship and Informal Economy…….…….…...41 • Relative experience and serial entrepreneurship…...…..……44 • Black population density, retail scarcity, and informal economy exploitation…………..……46 • Black distrust…………………………………….………….…….47 • Disparity in perceptions of corruption…………………….…….48 • Perceptions of firm performance……………………….……….49 • Alternative Trade Processes…………………………….………53 2.4 Conclusions…………………………………………………..……………56
SECTION 3.0
RESEARCH METHODOLOGY..................................................59
SECTION 4.0
SURVEY OF THE BLACK ENTREPRENEURSHIP LITERATURE.....................................67
4.1 Descriptive Attributes of Black Entrepreneurship Papers……..………….69 4.2 Rankings on Black Entrepreneurship Researchers and Affiliations……..72
SECTION 5.0
SURVEY OF THE ENTREPRENEURSHIP LITERATURE PUBLISHED BY HBCUs...........................................................79
5.1 Descriptive Results……………………..……………………………………...79 5.1.1 Proportion of HBCU Publication……………………….………...79 5.1.2 HBCU Authors and Affiliations…………………….……………..81 5.1.3 Paper Characteristics……………...……………………………..81 5.1.4 Sole Authors versus Collaborators……...…………..….……….82 5.1.5 Most Prolific HBCU researchers (and HBCUs)…………..…….83 5.1.6 Representation among publication outlets..……..…………….89 5.2 What HBCUs are Publishing in Entrepreneurship (Paper Titles)….…..….89
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SECTION 6.0
SUMMARY: SURVEY OF THE BLACK ENTREPRENEURSHIP LITERATURE ………….95
6.1 6.2
Areas of the Black Entrepreneurship Literature…….….………………..…95 Rates Of Black Entrepreneurship………….....................…………………96 6.2.1 Entrepreneurial Propensity……………….………………………96 6.2.2 Perceptions: Alertness, Optimism, and Overconfidence……..96 6.2.3 Nascent Entrepreneurship Rate…………………………….……97 6.2.4 First-time Entrepreneurship………………………….……...……98 6.2.5 Established Business Ownership……………………………..…99 6.2.6 Similar Circumstances in other Countries……………………..101 6.3 Factors Determining Black Entrepreneurship Rates…..……..…………..102 6.3.1 Personal Capital/Assets…………………………..……….……102 6.3.2 Restricted Access to Capital………….………...………………103 6.3.3 Education: General and Entrepreneurial Education………...104 6.3.4 Employment and Labor Force…………..……….……………..105 6.3.5 Age……………………………………………………….………..105 6.3.6 Marital Status in Spurring Entrepreneurship…….…………….106 6.3.7 Entrepreneurial Networks………………………….……………106 6.3.8 Urban Contextual Impact………………………………….…….109 6.4 Characteristics of Established Black Business…...........………………..110 6.4.1 Double-Minority Challenge……………………………………..110 6.4.2 Community Involvement/Support………………...……………111 6.4.3 Affinity toward Business Training……...………………………111 6.5 Venture/Business Outcomes…………………………...………………….113 6.5.1 Entrepreneurial Earnings……………………………………….113 6.5.2 Measures of Business/Venture Success……..………………114 6.5.3 Entrepreneurship as a Better Means Toward Ends..………..115 6.6 Post-Slavery Era Entrepreneurship………….…………………………..…116 6.7 Concluding Remarks……….………………………………………………...116 Suggested Exploratory Research Propositions……………………117
SECTION 7.0
RANKINGS OF TOP ENTREPRENEURSHIP RESEARCHERS AND AFFILIATIONS...................................120
7.1 Introduction…………………………………………………………….……..120 7.2 Overlap of “Top” Entrepreneurship Programs…………………….………121 7.3 Most Prolific Authors (1995 – 2006)…………………………........…….…122 7.4 Most Prolific Affiliations (1995 – 2006)………………………...….....….…126 7.5 Top Affiliations by U.S. and by Non-U.S. Status………………….………128 7.6 Integrating Prior Research: Shane’s (1997)………………………………….. and the Current Study’s Results ………..132 7.7 Concluding Remarks……………………………………………………...…134
SECTION 8.0 8.1 8.2 8.3
8.4 8.5 8.6
EXAMINING OPPORTUNITY RECOGNITION RESEARCH OUTPUT SINCE 1995.......................................136
Introduction………………………………….……………………………...…136 Methodology…………………………………………….…………………….138 Results……………………………………………….………………………..140 8.3.1 Outlets Publishing on Opportunity Recognition……………….140 8.3.2 Researcher Productivity on Opportunity Recognition……..…144 8.3.3 Affiliation Productivity on Opportunity Recognition………...…148 8.3.4 Productivity by “Top Ranked” Programs….……………..…….153 Discussion of Findings…………………………………….…………………155 Future Research Needs and Opportunities for Researchers…...….…...157 Concluding Remarks……………………………………………………...…158
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SECTION 9.0 9.1 9.2 9.3 9.4 9.5
CONCLUDING REMARKS.....................................................160
Major Contributions……………………………………….………………….160 Unanswered Research Questions…………………….……………………163 HBCU Research Output……………………………….…………………….164 Limitations of Study…………………………………….…………………….166 Future Research Directions…………………………….…………………...169
SECTION 10.0 REFERENCES.......................................................................173 APPENDIX A
SUMMARIES OF BLACK ENTREPRENEURSHIP PAPERS...........................190
APPENDIX B
TOP 100 ENTREPRENEURSHIP AUTHORS - IN GENERAL..........................................................214
APPENDIX C
TOP 100 ENTREPRENEURSHIP AFFILIATIONS - IN GENERAL..........................................................220
APPENDIX D
TOP 100 ENTREPRENEURSHIP AUTHORS – IN OPPORTUNITY RECOGNITION......................224
APPENDIX E
TOP 100 ENTREPRENEURSHIP AFFILIATIONS – IN OPPORTUNITY RECOGNITION......................228
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LIST OF TABLES Table 1.1 Income & Poverty of Americans by Race in 2005………………..…….2 Table 3.1 Top 26 Journals for Entrepreneurship Publication……………..….….60 Table 4.1 Descriptive Attributes by Paper………………………………..………..70 Table 4.2 Weighted Number of Papers Rankings for 29 Authors Publishing Black Entrepreneurship Literature……………………75 Table 4.3 Weighted Number of JBV-pages Rankings for 29 Authors Publishing Black Entrepreneurship Literature………….76 Table 4.4 Weighted Number of Papers Rankings for 21 Affiliations Publishing Black Entrepreneurship Literature…….…77 Table 4.5: Weighted Number of JBV-pages Rankings for 21 Affiliations Publishing Black Entrepreneurship Literature……………………78 Table 5.1 Table 5.2 Table 5.3 Table 5.4 Table 5.5
Top Ranked HBCU Authors in Entrepreneurship Literature……….…84 HBCU Weighted Papers on Entrepreneurship……………………..….85 HBCU Weighted JBV-pages in Entrepreneurship………………..……86 Publication Outlet Productivity by HBCU Authors……………..…..…..90 What HBCUs are Publishing in Entrepreneurship (by Paper Titles)…………………………………………………..…91
Table 7.1 Entrepreneur Magazine's 5th Annual Top 50 Entrepreneurial Colleges for 2007………..…….……….122 Table 7.2 Rankings of Top 25 Authors by Total Weighted Papers……….……124 Table 7.3 Rankings of Top 25 Authors by Total JBVpages………….…………125 Table 7.4 Rankings of Top 25 Affiliations by Total Weighted Papers…….…...127 Table 7.5 Rankings Top 25 Affiliations by Total Weighted JBVpages………...128 Table 7.6 Rankings of Top 25 US Affiliations by Total Weighted Papers….....129 Table 7.7 Rankings of Top 25 US Affiliations by Total Weighted JBVpages…130 Table 7.8 Rankings of Top 25 Non-US Affiliations by Total Weighted Papers.131 Table 7.9 Rankings of Top 25 Non-US Affiliations by Total Weighted JBV pages.………………………………………….………………132 Table 7.10 Top Author Contributors to Entrepreneurship Literature: Across Two Investigation Periods (1987-2006)……………….133 Table 7.11 Top Institutional Contributors to Entrepreneurship Literature: Across Two Investigation Periods (1987-2006)…………..…….134 Table 8.1 OpRec Papers (1995-2006): Frequencies and Percentages…….…142 Table 8.2 Period 1 OpRec Papers (1995-2000): Frequencies and Percentages…………………………………..143 Table 8.3 Period 2 OpRec Papers (2001-2006): Frequencies and Percentages…………………………………..144 Table 8.4 Top 28 Authors for Weighted Opportunity Recognition Papers in Combined Periods (1995 - 2006)…………….…….146 Table 8.5 Top 26 Authors for Weighted OpRec Papers in Period 1 (1995-2000)…………………………………………………....….147 Table 8.6 Top 25 Authors for Weighted OpRec Papers in Period 2 (2001-2006)……………………………………………………..…148 Table 8.7 Top 26 Affiliations for Total Weighted Opportunity Recognition Papers in Combined Periods (1995-2006)…..…151 Table 8.8 Top 28 Affiliations for Total Weighted OpRec Papers in Period 1 (1995-2000)……………………………………….…152 Table 8.9 Top 34 Affiliations for Total Weighted OpRec Papers
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in Period 2 (2001-2006)…………………………………..………153 Table 8.10 Top Ranked Entrepreneurship Magazine Universities that Published Opportunity Recognition Papers………………………….……..154 APPENDIX B Rankings of Top 100 Authors by Total Weighted Papers…..…..215 APPENDIX C Rankings of Top 100 Affiliations by Total Weighted Papers…...221 APPENDIX D Top 100 Authors for Weighted Opportunity Recognition Papers in Combined Periods (1995 - 2006)…………….….….225 APPENDIX E Top 100 Affiliations for Total Weighted Opportunity Recognition Papers in Combined Periods (1995-2006)………229
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1.0 INTRODUCTION The following discussion presents problems resulting from the current economic state of the U.S. black∗ population: Problems of which increases in black entrepreneurship could provide a solution. At the beginning of 2008, the unemployment rate of blacks in the U.S. was more than double that of whites in the U.S. Specifically, the unemployment rate was approximately 4.4 percent for whites and just over 9.2 percent for blacks (U.S. Bureau of Labor Statistics, 2008). In fact, the rate of black unemployment in the U.S. has remained double that of whites for the last 50 years (Badgett, 1994; Cherry, 2003; Spriggs & Williams, 2000). As a result, the wealth levels of blacks have remained significantly less than that of whites (Bates, 1996; Bradford, 2003; Fairlie, 1999; Singh & McDonald, 2004; Rhodes & Butler, 2004). Fairlie (1999) found that the household asset levels of blacks were 25 percent lower than those of white American households. Similarly, the U.S. Census Bureau (2003) reported a median household net worth of $79,400 for whites in 2000, while the median household net worth of blacks was just $7,500. Also, the highest quintile of white households enjoyed a median household net worth of $208,023, compared to $65,141 for the highest quintile of black households. In the lowest quintile of U.S. households, the median household net worth for whites was $24,000, compared to a low of $57 for blacks.
∗
The term “blacks” is used to represent the broader groups of blacks in the U.S., which include African-Americans and also black people from African countries, the Caribbean, and other countries.
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Black households also earned the lowest income of all races in the U.S. from 2003 to 2005 (U.S. Census Bureau, 2006). In 2005, the median household income of blacks was $15,468 less than the median for all Americans. The median income for black households was $30,858 which is 39 percent lower than whites, 49 percent lower than Asians, and 14 percent lower than Hispanics (see Table 1.1). Similarly, black per capita income was nearly half that of whites. The wealth and income disparities are major reasons for the disproportionately high poverty rates for blacks. While nearly 90 percent of all Americans enjoy living above the poverty line, 1 out of every 4 blacks lives in poverty (U.S. Census Bureau, 2006).
Table 1.1: Income & Poverty of Americans by Race in 2005 Median Income
Per Capita Income (approximated)
Families in Poverty
Individuals in Poverty
All Americans
$46,326
$34,500
10.8%
12.6%
Blacks
$30,858
$17,000
23.6%
24.7%
Whites
$50,784
$28,000
6.0%
8.3%
Asians
$61,094
$27,000
8.9%
11.1%
Hispanics
$35,967
$14,500
20.6%
21.8%
Source: U.S. Census (2006). 2005 Income, Poverty, and Health Insurance Coverage in the U.S.
Low income also carries negative implications for people’s health. It is well-established that people’s health levels positively vary with income levels (Currie & Stabile, 2003). Wilkinson (1996) goes a step further arguing that 2
income inequality renders negative health consequences to all members of a society because in societies marked by income inequality, people involve themselves less in social and voluntary activities outside of the home. Moreover, the relationship between people’s income and health levels intensifies among children of low social economic status, thereby worsening as these children age because the children receive more shocks to their health in forms such as chronic conditions and diseases requiring hospitalization; which then negatively affects their health as adults (Currie & Stabile, 2003). In the U.S., more than 45.6 million people lack health insurance coverage, thereby excluding many Americans from receiving preventive and/or corrective treatment for illness, disease, and premature death. Again, there is an inverse relationship between household income and having health insurance (U.S. Census Bureau, 2006). Rasell and Bernstein (1995) explain that health-care expenses are high for all families in the U.S., but particularly so for those with low incomes. They show that if families in the lowest income quintiles paid for health care premiums, that they would pay an average of 32.8 percent of their income, compared to 3.3 percent for families in the highest quintile. As Table 1.1 shows, blacks earn the lowest incomes. Accordingly, they remain uninsured at a disproportionately high level. Specifically, 19.5 percent of blacks (more than 7 million) lacked health insurance coverage, compared to only 11.2 percent of whites, and 15.7 percent of all Americans from 2003 to 2005 (U.S. Census, 2005).
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The negative unemployment, wealth, income, poverty, and health insurance statistics discussed above have significant impacts on American society. In addition to the adverse impacts that unemployment renders to the unemployed and their families, which include financial loss and a host of psychological problems that include learned helplessness, loss of self-esteem, and depression (Winefield, 2002), substantial societal and economic costs also exist. Some of the more salient impacts include increased crime (Corman & Mocan, 2000; Curley, 2005; Burdett, Lagos, & Wright, 2003), reduction in societal standard of living, lower national gross domestic product, and increased tax demand for societal welfare (Curley, 2005). Poverty alone accounts for a major share of the negative implications for American society. Joassart-Marcelli, Musso, and Wolch, (2005) found that poverty negatively impacts the fiscal health of cities in that it increases spending on antipoverty programs while also raising the costs of providing more general public services such as police and fire protection. Hence, poverty increases the demand for services and reduces the ability to provide for them. Poverty rates also impact violent crime rates. Corman and Mocan (2000) found that murder and assault rates increase with poverty levels. In turn, crime poses substantial risks to the physical and psychological health of victims and, consequently, generates additional demand and costs for health services (Robinson & Keithley, 2000). Even people who witness crime without actually being a victim can suffer psychological and psychosomatic problems such as stress, depression and sleeping difficulties (Robinson & Keithley, 2000). Robinson and Keithley (2000) 4
point out that victims of common property crimes such as theft and burglary can also suffer psychological trauma, especially in poor communities with high crime rates. Americans endure enormous costs for health care services resulting from crime. Miller, Cohen, and Rossman (1993) found these costs to be an estimated $10 billion in potential health-related costs in 1987 for physical injury to people aged 12 and over resulting from rape, robbery, assault, murder and arson, excluding some unmet mental health care needs. Ten years ago, Cohen and Miller (1998) estimated costs to be between $5.8 and $6.8 billion a year for mental health services to crime victims. Today, those costs must be significantly greater. Americans must also bear opportunity costs in that increased usage of health services to crime victims diverts health care resources from other patients (Powell, Sheehan, & Christoffel, 1996; Ryan, Leighton, Pianim, Klein, & Bougard, 1993; Song, Naude, Gilmore, & Bougard, 1996).
1.1 Black entrepreneurship: A solution and the reality New ventures and small businesses are responsible for most of the new jobs within economies (Birch, 1989; Scarborough & Zimmerer, 2005). They create as much as 80 percent of all net new jobs annually in the U.S., produce 13 to 14 times more innovative patents per employee than large firms, and employ half of all private sector employees (Lee, 2006). Increasing the rate of black entrepreneurship could provide a viable solution to the significant economic and social problems discussed herein. 5
As Schneider’s (1987) attrition-selection-attribution (ASA) model shows, people from the labor pool are attracted to and selected for employment by firms having similar salient attributes as themselves. The model also shows that people are more likely to stay at firms employing others who possess the highest degrees of attribute similarity as themselves. Research shows that black business owners are more likely to hire blacks and other minority job seekers, than are white business owners (Bates, 1994). Therefore, black entrepreneurship in America as a viable solution would manifest itself through the creation of more jobs in the U.S. for blacks, by blacks. As the number of black businesses in existence increases, the number of blacks receiving jobs and increasing their income may also increase. With the added income, there should be more money available to pay for increased health insurance coverage, as well as to decrease the poverty rate, and therefore the crime rate. As a result, the costs to American society in general would be minimized, ultimately rewarding Americans with a higher standard of living, and a higher quality of life and well-being. Unfortunately, the reality is that the new venture founding rates and selfemployment rates of blacks are lower than those of other groups in the U.S. (Bradford, 2003; Fairlie & Meyer, 2000; Butler, 1991; Ede & Calcich, 1998; Fairlie, 1999; Fairlie & Meyer, 1996). In fact, blacks are one-third as likely to be self-employed than whites (Fairlie, 1999); and the one-to-three ratio for the black versus white founding rate has remained roughly constant over the past 80 years (Fairlie & Meyer, 2000; Fairlie & Meyer, 1996). Four percent of blacks in the U.S. are self-employed, compared to 12 percent of whites in the U.S. (Fairlie, 6
2004, 1999; Fairlie & Meyer, 1996). Blacks also exit out of entrepreneurship at higher rates than the larger group of Americans (Fairlie, 1999). According to the U.S. Census Bureau (2007), of the nearly 300 million Americans in the total population, blacks accounted for nearly 39 million (compared to approximately 199 million for whites, and 62 million for others). If, as research indicates, four percent of them are entrepreneurs, that would roughly equate to nearly 1.6 million, compared to roughly 23.9 million (12 percent) for whites. In 2002, these figures are supported as there were 1.2 million blackowned firms that accounted for just over $88.6 billion in sales receipts (U.S. Census, 2002). Of those, 94,518 were firms with paid employees, and they accounted for $65.8 billion in sales receipts.
1.2 The need for more research on black entrepreneurs Increasing the rate of black entrepreneurship has been the goal of community leaders and policy makers for decades. Yet, as discussed above blacks have consistently remained underrepresented in entrepreneurship. The low founding rates and self-employment rates among blacks are surprising given that research has found that blacks express greater enthusiasm and interest in pursuing entrepreneurship than whites. Research has found that black high school students are more interested in pursuing entrepreneurship than white high school students (Waistad & Kourilsky, 1998). But, this interest is not translating into new ventures.
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Most of the existing literature that has looked at the impediments to black entrepreneurship has focused on financial reasons such as lower access to capital, discriminatory lending practices, lower savings, and similar undercapitalization issues (Bates, 1996; Bradford, 2003; Fairlie, 1999; Rhodes & Butler, 2004; Squires & O’Connor, 2001). But, if undercapitalization was the only problem, it would have likely been solved or at least improved a long time ago through the increased numbers of affirmative action lending initiatives, community banks giving micro loans, Community Reinvestment Act credits, and urban revitalization efforts such as empowerment zones and enterprise community initiatives. Yet, in spite of these efforts, there has been little change in the firm founding rates of blacks over the last 80 years (Fairlie, 1999). Some may reason that the problems impeding blacks from increasing their lower founding rates are no different than problems confronting the population in general. However, the literature exploring black entrepreneurship seems to suggest that the black experience in the U.S. may be unique relative to entrepreneurs of other races. Just one example of an apparent difference relates to having a father who is an entrepreneur. Having a father who is an entrepreneur has consistently been found to be related to becoming an entrepreneur (Hisrich, Peters, & Shepherd, 2005; Hundley, 2006). This is not surprising given that fathers serve as role models, and pass on knowledge and experience to their children. However, this well established concept apparently does not hold for blacks. In fact, Hout and Rosen (2000) found evidence to the contrary. They 8
reported that, black men whose fathers were self-employed are less likely than white men to follow their fathers into self-employment. Singh, Crump, and Zu (2007) recently analyzed an updated version of Hout and Rosen’s (2000) dataset and found that black men and women were unique in that having an entrepreneurial mother was a strong predictor of entrepreneurship for them. Whereas, unlike other groups, having an entrepreneurial father was not a predictor of entrepreneurship for them. There are other differences between black and white entrepreneurs in the literature. Singh, Knox, and Crump (2008) found that differences in the opportunity recognition processes between blacks and whites exist even after controlling for capital and education. Black entrepreneurs are more likely to recognize externally-stimulated (ES) opportunities than their white counterparts, and whites are significantly more likely to recognize internally-stimulated (IS) opportunities. An ES opportunity is one that is recognized only after deciding to start a new venture, and searching for an unmet need or unsolved problem. Alternatively, an IS opportunity is one where an entrepreneur recognizes an unmet need or unsolved problem, first, and afterwards decides to exploit the opportunity (Bhave, 1994). This difference between black and white entrepreneurs was statistically significant, and may be important. Singh and Hills (2003) found that opportunities recognized through IS processes are more lucrative than those recognized through ES processes. Thus, combining the above two findings, it appears that blacks more often recognize opportunities that are not as lucrative as those recognized by whites. 9
Exploring the unique characteristics, culturally-driven behaviors, and entrepreneurial processes of black entrepreneurs may yield important insights into the reasons for the disproportionately low firm founding rate of blacks. Yet, identifying the differences between black and white entrepreneurs and understanding how those differences affect new venture founding rates has not been well examined in the literature to date. It is the belief of the current author that some of the findings in the extant entrepreneurship literature may not apply as directly to black entrepreneurs. This circumstance suggests that there is a need to further research and understand black entrepreneurship and differences that may exist with other groups of entrepreneurs. Given the need for research on black entrepreneurship, Historically Black Colleges and Universities (HBCUs) could provide a leadership role in this research endeavor. HBCUs have a special focus and mission. Often, their missions include providing knowledge and education to black members of the U.S. population who would otherwise not receive such training. Accordingly, they serve key aspects of their communities including: •
driving the educational advancement of their community members
•
increasing the quality of life of community members through dissemination of knowledge
•
facilitating reduction in unemployment rate among community members
•
enhancing network configurations among community members
10
•
facilitating increases in self-employment rates among community members as a means to achieving upward mobility, leaving legacies for family members, and so forth.
Often, HBCUs represent the first, and last, lines of defense against problems confronting urban and/or black communities. When research is conducted and published by entrepreneurship scholars who are intimately aware of community idiosyncrasies, the communities served are appropriately served. This is because research on matters specific and unique to an institution’s community members is easily applied in extremely useful ways. Therefore, because of the important research orientation on this topic that HBCUs possess given their adopted missions, the literature stands much to gain if they provide research leadership in creating new knowledge in this area. If future entrepreneurship research efforts conducted by both HBCUs and non-HBCU scholars and institutions inform us on how to increase the successful entrepreneurial founding rates of blacks in America by just two percentage points, from four to roughly six percent, then based on the 39 million blacks in the population, the increase should account for 780,000 new entrepreneurs added to the existing rate. Such an increase would roughly equate to closing the blackwhite entrepreneurial gap to a one-to-two ratio (over Fairlie’s, 1999 observed one-to-three ratio). The economic and social impact of such an increase would be enormous. If we then project those figures onto sales receipts, assuming a variable-sum game economic environment, then we should expect just over 11
61,000 new firms with paid employees (the majority of whom would be assumed to be black) that generate an additional $43 billion in new sales revenues to the U.S. economy’s national account. Certainly, such an increase may help to close the poverty, unemployment, health insurance, and wealth gaps between blacks and other groups of Americans. The increase may also enhance the U.S. standard of living, decrease its crime rate, and help to minimize many of the other societal perils and ills that continue to plague the American way of life. However, the extent to which black entrepreneurship has been studied in the literature has remained an empirical question. One of the goals of this dissertation is to examine the body of knowledge that has been developed on black entrepreneurship. This dissertation also compares the HBCU publication on black entrepreneurship to that of non-HBCUs on the same topic area.
1.3 Research Objectives The purpose of this dissertation is twofold: (1) to provide a review of the existing literature on black entrepreneurship, and (2) to delineate, rank, and summarize who (researchers and institutions) are publishing what with respect to black entrepreneurship. The key specific research objectives for this dissertation are to:
1. Conduct a thorough and exhaustive literature review of what is known about black entrepreneurship.
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2. Understand how black entrepreneurship relates (and does not relate) to the major research findings within the entrepreneurship literature. 3. Identify the researchers and institutions that are conducting and publishing research related to black entrepreneurship. 4. Examine to what extent historically black colleges and universities (HBCUs) and HBCU scholars are involved in conducting research on black entrepreneurship. 5. Identify future research directions and key research questions not addressed on black entrepreneurship. The contradictions discussed above emphasize the importance of summarizing the black entrepreneurship literature. The summary review provided by this dissertation fulfills that need. The review organizes the current knowledge on black entrepreneurship, highlighting its points of similarity and departure to the literature on entrepreneurship in general. The importance of ranking the scholars and institution who have produced the knowledge is discussed next. Many groups are highly interested in the rankings of academic research output. These groups include: 1) constituents internal to universities such as faculty and administrators for the purposes of program assessment, resource allocation, merit awards, and program advertisement; and 2) constituents external to universities such as funding agencies, potential students, and faculty applicants for various decision-making (Chan, Chen, and Cheng, 2006; Chan, Chen, & Steiner, 2004; Cheng, Chan, & Chan, 2003; Mathieu, & McConomy, 13
2003; Erkut, 2002; Shane, 1997). Moreover, these rankings contribute to the reputation capital of business schools and universities (Chan et al., 2004; Erkutt, 2002). Chan et al. (2004), and Erkut (2002) explain how many universities and colleges take seriously national rankings such as Business Week, US News & World Report, and Financial Times. These researchers quote Financial Times in explaining how strong research capabilities and international diversity enabled the Wharton School to uproot Harvard Business School from its number one spot in 2001. In response to the high interest in academic output rankings, several studies have investigated research output, rankings of programs, and journal quality in various business disciplines (see, for example Chan et al., 2006; Chan et al., 2004; Cheng et al., 2003; and Erkutt, 2002.). Looking at the separate research output of HBCUs relative to non-HBCUs may prove an important part of knowing where increased research effort is needed in order to close the entrepreneurship founding rate disparity between black and white entrepreneurs. Fortunately, several of the researchers cited above have demonstrated that investigations similar to this one have proven to be invaluable. Some of them, such as Johnny Chan of Western Kentucky University, have even carved out important research niches for themselves, securing future research streams that continue to lead to publication contributions to their respective fields. To this researcher’s knowledge, no current studies rank entrepreneurship research productivity in terms of quantity of journal articles and proceedings published during the last ten or more years. The last study ranking research productivity in 14
entrepreneurship was published by Shane (1997) more than ten years ago. His investigation period included publications from 1987 through 1994, and his did not directly compare the productivity output on black entrepreneurship or of HBCUs. Apparently, this study is the only one of its kind looking at black entrepreneurship and HBCU productivity with respect to entrepreneurship research. Based on the current analysis of the literature, it is also the only entrepreneurship research productivity ranking conducted between 1995 and 2006.
1.4 Organization of Study The objectives of this dissertation are met through a thorough review of the management and sociology literature, and empirical analysis of the entrepreneurship research literature output in the leading academic outputs. The remaining sections are organized as follows: Section 2 presents an extensive literature review. When combined with the discussion in Section 6, which summarizes and discusses in detail the black entrepreneurship papers identified in the dataset, the sections comprise an exhaustive survey of the literature and the major findings of what knowledge currently exists on the topic of black entrepreneurship. This survey can aid researchers in understanding what is known that can help explain the disparity in entrepreneurial founding rates between black entrepreneurs in the U.S. and other entrepreneurs. Antecedent causes to that disparity are explored in these sections. Section 2 also comprises a conceptual discussion that suggests exploratory theoretical relationships 15
among various black entrepreneurship topic areas that might facilitate better research and promote better understanding of black entrepreneurship issues. Section 3 describes this study’s methodology for accomplishing the empirical research objectives. In order to accomplish those objectives, the researcher manually inventoried all entrepreneurship journal articles published during the 12-year period from 1995 to 2006 in the top entrepreneurship publication outlets. This list of 26 journals (Table 2, Section 3) is compiled from Harzing (2006), Katz (2003b, 2006), and Shane (1997). The researcher also physically inventoried each proceeding in the top three long-running U.S. annual entrepreneurship conferences listed in Katz (2003b). The conferences are the Babson College Entrepreneurship Research (Babson) conference; the United States Association for Small Business and Entrepreneurship (USASBE) conference; and the University of Illinois at Chicago/American Marketing Association (UIC/AMA) Symposium on Marketing and Entrepreneurship. For each article and proceedings paper, specific information was collected on its attributes, authors, and affiliated institutions. After the data was collected, the authors and their institutional affiliations were rank ordered based on weighted number of papers published, and on weighted number of pages published. Longitudinal comparisons throughout the 12-year period were computed on the top-ranked authors and affiliations. Section 4 provides summary rankings of all of the authors and institutions that have published papers examining black entrepreneurship issues in the major entrepreneurship literature over the 12-year period of analysis. This section 16
shows which researchers are providing research leadership in advancing the knowledge available on black entrepreneurship. The section also shows which institutions are most responsible for advancing the field in this area. Section 5 provides summary rankings and analysis of research output specifically from HBCU scholars and HBCU institutions. This section shows who the most prolific HBCU scholars and institutions are in terms of the numbers of papers and pages published in the entrepreneurship literature. It also shows which types of research studies these scholars are investigating. Section 6 summarizes which major research questions the dataset’s articles and proceedings papers address. This section specifically summarizes all of the black entrepreneurship papers published in the major entrepreneurship outlets only. These findings shed light on where increased research effort is needed in order to understand and increase black entrepreneurship in that literature. The findings are organized into overarching research categories that constitute the structure of the existing black entrepreneurship literature. In order to understand how the state of black entrepreneurship literature relates to the broader entrepreneurship in general literature, Section 7 provides supplementary analysis and rankings of all authors and institutions that have published entrepreneurship papers, beyond black entrepreneurship. This section shows which scholars and institutions are providing leadership in advancing the field of entrepreneurship in general. The section ranks which researchers and scholars provided the highest numbers of papers and pages in the entrepreneurship literature. 17
Section 8 provides supplementary analysis in the form of rankings information of all authors and institutions that have looked at opportunity recognition, a critical component of the entrepreneurship process. A major component of any entrepreneurial venture is the recognition of the opportunity by the entrepreneur (e.g., Bhave, 1994; Hills, 1994; Shane & Venkataraman, 2000; Timmons, 1994). This section focuses in particular on measuring the influence of Shane and Venkataram’s (2000) AMR article on advancing opportunity recognition research. The scholars and institutions who published the highest numbers of papers and pages in this research area are also ranked. And, finally, Section 9 presents implications of all results, summarizes unanswered research questions, offers future research directions for study, and concluding remarks. This section argues that more research is critically needed in order to aid black nascent entrepreneurs to achieve higher levels of entrepreneurial success. It also argues the importance of new language, tools, and paradigms in accomplishing this goal. The final argument in this section is for increased HBCU research in the black entrepreneurship literature, given their situational advantage in uncovering knowledge in this critical area.
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2.0 LITERATURE REVIEW
2.1 Introduction This section comprises a survey of the literature on black entrepreneurship. It presents the major findings that currently exists within the literature. Section 6.0 provides additional details and discussion on the black entrepreneurship papers that were published during the 12-year period of analysis (1995 - 2006) in the top entrepreneurship and management research outlets, which are the focus of the empirical portion of this dissertation. The findings shed light on the disparity in the entrepreneurial founding rates between black and white entrepreneurs. Potential antecedent causes to the disparity are also explored in this section. Those antecedent topics include the following, among others: •
Impediments to access to capital markets (Bates & Bradford, 2004, 1992; Herring, 2004; Rhodes & Butler, 2004; Singh & McDonald, 2004; Squires & O’Connor, 2001)
•
Opportunity recognition, and its consequences on lucrativeness of opportunities (Singh, Knox, & Crump, 2008)
•
Differences in cognitive processes (Baron & Ward, 2004; Gaglio, 2004; Gaglio & Katz, 2001; Kirzner, 1979; Mitchell et al., 2002; Simon & Houghton, 2002)
•
Differences in serial entrepreneurship rates, or in knowledge corridor configurations (Rondstadt, 1988) 19
•
Urban settings and population density (Porter, 2005; Porter, 2004; Porter & Blaxhill, 1997; Weiler, Silverstein, Chalmers, & Lacey, 2003)
•
Informal economy trade options (De Soto, 1989; Gang & Gangopadhyay, 1990; Gershuny, 1979; Kuznetsova, 1998; Schuck & Litan, 1987; Smith, 1981; Weiler et al., 2003)
•
Distrust towards others (Bourgois, 1990; Duany, 1992; Hainer et al. 1990; Howell & Fagan, 1988; Sussman, Robins, & Earls, 1987; Terrell & Terrell, 1993; Whaley, 2004; Whaley, 2001)
•
Perceptions of unfair government regulations (Acemoglu & Verdier, 2000; Choi & Thum, 2005)
•
Differences in trade processes, and in perceptions of firm performance (Adams & Sykes, 2003; Fishman, 1995 A, 1995 B; Gyoshev, Manev, & Manolova, 2005; Hornaday & Wheatley, 2001; Rhodes & Butler, 2004; Robinson, Blockson, Robinson, 2005).
This section also comprises a conceptual discussion that explores theoretical relationships for various black entrepreneurship topic areas that might facilitate better research and understanding of black entrepreneurship. Exploratory propositions based on the suggested relationships are presented in Section 6 for future research. The current section begins with a literature review that contains knowledge drawn from the broader management, entrepreneurship, and sociology literature that is currently available on black entrepreneurship. The section then describes peculiarities on the subject identified in that literature. 20
Next, the research questions that remain unanswered in the literature on black entrepreneurship are presented and discussed. A research model for black entrepreneurship is also proposed and discussed. The section ends with a brief summary and suggestions for future research investigation.
2.2 What Is Known About Black Entrepreneurship 2.2.1 Blacks score high on entrepreneurial propensity As explained in Section 1.0, the literature examining the state of black entrepreneurship in the U.S. paints a very gloomy picture. Yet, strong support exists for the idea that blacks score higher on entrepreneurial propensity than whites (Butler, 1991; Herring, 2004; Köllinger & Minniti, 2006; Walstad & Kourilsky, 1998). That is, they possess a strong tendency towards entrepreneurship engagement, marked by a high degree of motivation, interest, and intentions. This phenomena helps to explain why the number of African American firms, along with Hispanic, Asian and Native American firms, grew four times faster than the rate of all firms between 1992 and 1997 (Wellner, 2002). In fact, the literature supporting differences in entrepreneurial propensity measures as far back as the post-slavery era (see Galbraith & Stiles, 1999). Black youth are more interested in entrepreneurship than white youth (Walstad & Kourilsky, 1998; Wilson, Marlino, & Kickul, 2004), and they score high on motivations that lead to self-employment (Singh & McDonald, 2004). In addition, many people including blacks view entrepreneurship as a key venue to ending poverty and unemployment in black slums (Herring, 2004). Moreover, a 21
significant percentage of blacks have always been grounded in a tradition of selfhelp, education, and entrepreneurship, and is responsible for the creation of black businesses, educational institutions, and organizations within the black community (Butler, 1991). Herring (2004) notes that labor market discrimination and a large degree of aspiration for business ownership among black Americans is a push factor for black entrepreneurship and self-employment. The initiation rates of black men and women are nearly three times those of white men and women, and twice those of white women (Butler, 1991). In fact, blacks have been found to have the highest levels of propensity to start a business among blacks, whites and Asians (Köllinger & Minniti, 2006). Reynolds, Carter, Gartner, and Greene (2004) found that black adults (ages 18 to 64 years) are 50 percent more likely than white adults to attempt to start a business. And, that black women are more likely than white and Hispanic women to attempt to start a business. But, there is conflicting data in the literature. For example, Crosa, Aldrich, and Keister (2002) found that once human capital and education controls are factored in, blacks become only about 60 percent as likely as whites to become nascent entrepreneurs. Nonetheless, the literature seems to suggest that blacks are highly engaged in the process of entrepreneurship. But, as Section 1.0 also explained, blacks are highly underrepresented in entrepreneurship. The reason why the apparent contradiction exists is because blacks are highly engaged in nascent entrepreneurship (Köllinger & Minniti, 2006; Reynolds et al., 2004), and underrepresented in established business ownership 22
(Fairlie, 2004; 1999; Köllinger & Minniti, 2006). The difference is that although they are more likely to attempt to start new ventures, they are less likely to actually found the venture than other groups in the U.S. An additional problem is that black entrepreneurs who do establish businesses experience less success than white established business owners. Fairlie and Robb (2007) found that black-owned businesses lagged behind whiteowned businesses in profits, sales, number of employees, and survival. Robb (2002) also found that black businesses have the lowest survival rate when compared to Asians, Hispanics, Native Americans, and whites. In fact, Robb (2002) found that black-owned businesses are 43 percent more likely to close than white-owned businesses. The next section presents literature that discusses some of the reasons why blacks experience less entrepreneurial success.
2.2.2 Blacks are under-resourced: Capital, community and network support, education As previously discussed, over the past 50 years, the unemployment rate of black Americans has remained about twice that of white Americans (Badgett, 1994; Spriggs & Williams, 2000). Blacks are also less wealthy than whites and other ethnic groups (Bradford, 2003; Fairlie, 2005; 1999; Singh & McDonald, 2004; Portes & Zhou, 1996). The lower levels of financial resources among blacks result in financial resource constraints that may prevent successful entrepreneurship among blacks. The literature explains that lower net worth, 23
fewer assets, and less access to capital are reasons why fewer blacks become successful entrepreneurs (Bates, 1996; Fraser, 2003; Singh & McDonald, 2004). The literature also shows that blacks have fewer community lending institutions and persons who can provide financial aid to new businesses (Bates & Bradford, 2004; 1992; Herring, 2004; Rhodes & Butler, 2004; Squires & O'Connor, 2001). Rasheed (2004) explains some of the antecedents and outcomes of the undercapitalization of blacks in business, The disparity in access to capital based on social factors has been a recurring theme in small business finance literature and corroborated by government statistics. According to the U.S. Small Business of Administration (SBA) Office of Advocacy, 63.3% of African-Americans use some form of credit compared to the 75.7% for all small firms. Reflecting a greater disparity, only 36.5% of African American firms use traditional loans other than personal credit cards, compared to 54.8% for all small firms (www.sba.gov/advo, 2000). Empirical research supports these statistics. For example, Bates and Grown (1992) found that commercial banks treat African-American owned construction companies differently from Caucasian-owned firms. As a result of this disparity, African-American owned construction companies are typically less capitalized, and are more likely to fail than Caucasian-owned construction companies. Bates (1997) also found that African-American entrepreneurs receive smaller loans and rely more on consumer credit such as credit cards than Caucasian entrepreneurs with identical personal characteristics. Consequently, they are more likely to discontinue operations over time due to poor capitalization. Ethnicity has also been found to be a factor in mortgage lending which is often a source of initial funding for small firms (Squires & Velez, 1996). (p. 114) Thus, restricted access to capital is a noted contributor of impediments to successful black entrepreneurship (Bates & Bradford, 2004; 1992; Herring, 2004; Squires & O’Connor, 2001). 24
The frequency of start-up and existing business loan amounts for blacks are materially lower than white-owned firms, with white owners bringing 2.3 times more personal capital to their start-ups than minority owners (Rogers et al., 2001). Rogers et al. (2001) also found that firms with less access to loans from traditional sources and minority-owned firms are significantly smaller than their white-owned counterparts. The parents of black entrepreneurs own and control fewer resources than whites (Fairlie, 1999), and their family members exert greater restraining influence on the amounts of capital they can use to invest in their businesses (Fraser, 2003). Rasheed (2004) observed that ethnicity, gender, and education impact the amounts of capital that owners/managers can access through generating revenue from services, and from securing government procurements. With lower revenue, black firms have less operating capital generated by sales. Making matters worse is Rhodes and Butler’s (2004) finding that the socioeconomic conditions of the black community are not conducive to creating successful entrepreneurial role models for blacks. These researchers explain that higher educated black parents instill achievement motivation in their children in general. However, for these parents, whether the children choose wage work or self-employment is of no consequence. They just want their children to be successful. The researchers suggest that in resource-constrained black communities, blacks are more likely to opt into wage positions over selfemployment when jobs are in abundance, and will default into entrepreneurship only when jobs are in decline. Thus, commitment to entrepreneurship as a 25
career is not treated as the highest priority. So there tends not to be any social push toward entrepreneurship within the black community. Black entrepreneurs also have fewer informal and formal network contacts for securing key resources and information (Fraser, 2003; Young, 1998). In addition to fewer community lending institutions and fewer persons who can provide financial aid to new businesses, Rhodes and Butler (2004) also found the institutional structures of the black community to be comprised of an underdeveloped Black American Chamber of Commerce, and weak resourced business organizations. Black businesses are often dependent on local customer support. Yet, Herring (2004) attributes consumer refusal to engage in exchange with black businesses as an impediment to the equal representation of blacks in entrepreneurship. Rogers, Gent, Palumbo, and Wall (2001) studied central city entrepreneurs and found that 92 percent of minority owners’ customer bases are within the boundaries of the city, compared to slightly less than half of white owners’. So, although Nijkamp (2003) found urban incubators to be desirable for new venture startups, he cautioned that the condition may also lead to a social trap that prevents real entrepreneurial creativeness. Similarly, Werber (2001) cautions that while ethnic enclave economies enhance opportunities, they also make ethnic entrepreneurial groups highly vulnerable to within group macroeconomic and demographic changes. For example, if an entrepreneur is solely dependent on an ethnic enclave, and a shift in the enclave’s preference suppresses customer demand, the entrepreneur has no other established 26
customer base to hedge against loss of sales. Black youth are less likely to know a small business owner than white youth (Fraser, 2003; Walstad & Kourilsky, 1998), and less likely to have a parent who is a small business owner (Walstad & Kourilsky, 1998). Black entrepreneurs also have fewer available successful business persons who can provide business mentoring and financial aid to them (Rhodes & Butler, 2004). Perhaps this partially explains why Martin, Welch, Sandefur, and Pan (2006) found that established black business owners rate the importance of training in each of 23 business areas much more highly than white business owners. It is possible that whites rated the training as less important because they had more often received the training through informal mentoring. Blacks are less likely than whites to have fathers who were self-employed, making men from these groups less likely to become successful entrepreneurs (Hout & Rosen, 2000; Fairlie, 1999). Among men whose fathers were selfemployed, blacks are significantly less likely to follow their fathers into business ownership than white men. Further, black men whose fathers were selfemployed have lower rates of business ownership than black men whose fathers were not self-employed (Hout & Rosen, 2000). Singh, Crump, and Zu (2007) found that black men and women differ from whites in that having an entrepreneurial mother is more likely among black entrepreneurs than white entrepreneurs. However, unlike white men and women, having an entrepreneurial father is not a predictor of entrepreneurship for black men and women. 27
White business owners are more likely to possess a college degree and are substantially more likely to have prepared a business plan: factors that directly relate to levels of sales (Rogers et al., 2001). Blacks generally are significantly less educated than whites (Singh & Crump, 2008; Singh & McDonald, 2004; Fairlie, 1999). However, there is no difference between the education levels of black and white nascent entrepreneurs, and in fact, both groups are highly educated (Singh & Crump, 2008; Singh & McDonald, 2004). Further, Singh and Crump (2008) and Crosa et al. (2002) also found that education is more important than access to capital in increasing entrepreneurship prevalence rates among nascent entrepreneurs. Black entrepreneurs have fewer years of hands-on experience and business experience (Fraser, 2003). And, white nascent entrepreneurs have been found to be more than three years older than black nascent entrepreneurs (Singh & McDonald, 2004). Up to this point, this section has attempted to summarize the knowledge available on black entrepreneurship. These findings provide meaningful information about black entrepreneurship with respect to both nascent entrepreneurship and established entrepreneurship. The information provided primarily concerns factors that hinder or facilitate black participation in established business owner entrepreneurship. The information also provides clues on critical areas and research questions about black entrepreneurship that are not yet addressed, or are under-addressed, in the literature. Two questions that resonate as a result are: 1) If blacks score high on entrepreneurial propensity, then what factors suppress the actual rate of 28
entrepreneurship?; and, 2) Do peculiarities exist among blacks (relative to other groups) that make their entrepreneurial processes unique, therefore making the findings in the literature not as specifically relevant to them as other groups? So, while many factors, other than simply education and access to capital, exert restraining forces on the founding rates of black entrepreneurs, the factors relate to larger issues. These issues are not well addressed in the entrepreneurship literature, and they are presented next.
2.3 Unaddressed Research Questions about Black Entrepreneurship This section proposes an exploratory model of black entrepreneurship. The discussion that follows is segmented into three overarching research areas that are proposed for further investigation. The areas are: 1) black venture capital financing, trust, and serial experience; 2) black urban entrepreneurship; and, 3) black entrepreneurship and informal economy. Based on the discussion, a model is proposed that presents six push factors that may result in an inordinate amount black entrepreneurs operating in the informal economy.
2.3.1 Factors that Impact Rates of Black Entrepreneurship Exploitation Black opportunity recognition and lower lucrative value To reiterate, given that Singh, Knox, and Crump (2008) found that differences still exist between the numbers of blacks and whites exploiting new business ventures after controlling for capital and education, the overarching question that remains is, What other factors beyond education and capital drive 29
those differences? This study has previously discussed that Singh, Knox, and Crump (2008) found that black entrepreneurs more often than white entrepreneurs recognize entrepreneurial opportunities through externallystimulated processes, while their white counterparts recognize opportunities through internally-stimulated processes more often than black entrepreneurs. This study has also discussed Singh and Hills’ (2003) finding that opportunities recognized through internally-stimulated processes are more lucrative than those recognized through externally-stimulated processes. In combining the above two findings, it seems that blacks more often recognize opportunities that are not as lucrative as those recognized by whites. Challenges related to securing venture capital This section explores whether or not any antecedent differences exist among black and white entrepreneurs leading to their venture financing, and whether any of these differences drive the disparity in the founding rates of black versus white entrepreneurs. Black business ownership and viability are unfavorably influenced by lower levels of access to capital (Bates, 1996; Christopher, 1998; Singh & McDonald, 2004). Considering the possibility that blacks may be more likely than whites to recognize opportunities of lower lucrative value, it is plausible that would-be contributors of capital withhold support based on lower attractiveness levels of opportunities more so than because of racial reasons. Bates and Bradford (2004) found that minority-oriented venture capital (VC) firms do make considerable investments into minority business enterprises 30
(MBEs) and that these firms are earning high yields for doing so. However, minority-oriented VC firms still represent a small segment of the VC industry (Bates & Bradford, 1992). These researchers also observe an upward trend in the amount of funds these firms are investing into minority firms. They state that minority-oriented VC funds attract much more capital from institutional investors who anticipate yields broadly comparable to those of majority VC funds. Bates and Bradford (2004) also explain that the minority VC industry was a tiny sector in the early 1990s consisting of only a handful of pioneers. By the end of the decade, the sector passed the billion dollar threshold for funds raised; and by 2001, the industry passed the $2 billion threshold. Yet, as the researchers note, the current absolute size of the industry remains small. Bates and Bradford (2004) assert that open access to capital markets helps MBEs thrive and grow. The researchers also imply that closed and restricted access to capital markets cause MBEs to deteriorate and die. They further proclaim that “Whether or not VC is available to MBEs will depend in part on a greater understanding of how such funding support works.” (p. 37). Squires and O’Connor (2001) similarly question whether patterns of widespread disparities among lenders in the distribution of small business loans reflect, legitimate differences in marketing strategies among lenders, illegal discrimination against low-income areas and minority communities, business opportunities overlooked by some institutions, or a combination of these and other factors. (p. 42)
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These researchers (Bates & Bradford, 2004; and Squires & O’Connor, 2001) acknowledge the necessity of more research in order to fully understand the underlying causes for the existing disparities. Certainly any new knowledge derived from research related to whether blacks are more likely to recognize opportunities of lower lucrative value, as discussed above, could help to increase the incidence of successful black entrepreneurship. Such research may help to explain one factor, beyond discrimination, for why black entrepreneurs experience less access to capital markets. This discussion highlights three phenomena that likely constrain the amount of VC funding available to black entrepreneurs. The phenomena are, opportunities of lower lucractiveness, lower knowledge of VC processes, and fewer numbers of black VC firms.
Low trust and network structural differences among black entrepreneurs In addition to the possibility that differences in opportunity recognition explain a substantial portion of the differences in VC access for black versus white entrepreneurs, it may be that differences in the social network configurations of black relative to white entrepreneurs also explain some of the portion. For example, trust refers to one's willingness to rely on another's actions in a situation involving the risk of opportunism (Williams, 2001). In general, blacks are less trusting of others than whites (Bourgois, 1990; Howell & Fagan, 1988; Sussman, Robins, & Earls, 1987; Terrell & Terrell, 1993; Whaley, 2004; Whaley, 2001). Blacks in New York City routinely withhold information from public assistance authorities to protect illicit or irregular sources of income 32
(Bourgois 1990, as cited in Duany, 1992). The U.S. Census Bureau estimates that it missed 4.8 percent of the black population in 1990 compared to missing only 1.6 percent of the population as a whole (U.S. Census 1991). The undercount is even higher for several subgroups such as black men in their twenties (Hainer et al. 1990, as cited in Duany, 1992). If a sizable portion of blacks are less trusting of whites and others in the U.S., they may not participate in surveys on a belief that the information will somehow be used to their detriment. Terrell and Terrell (1993) found that black youth have a tendency to mistrust whites. The researchers believe that some black children and adolescents may not perform to their potential on standardized mental ability and achievement tests because they do not trust that whites will evaluate them fairly. These researchers also found that black adolescents who expect to enter less prestigious, lower paying occupations tend to be more mistrustful of whites, and therefore opt out of pursuing employment in fields they view as controlled by whites. Many black entrepreneurs found their ventures because they believe they are viewed (and accordingly treated) as outsiders by the mainstream wageemployment sector (Dollinger, 2003). Also, recall that Herring (2004) noted that labor market discrimination is a push factor for black entrepreneurship and selfemployment. If black entrepreneurs are less trusting of others, then they more often view others as potentially being opportunistic against them. This belief is likely to result in blacks more often becoming solo entrepreneurs (those who get their 33
business ideas on their own) versus network entrepreneurs (those who get their business ideas from others in their social networks). Then, if blacks are more likely to be solo entrepreneurs, they are also more likely to recognize fewer opportunities because, as Hills, Lumpkin, and Singh (1997) found, solo entrepreneurs recognize fewer opportunities than network entrepreneurs. If black entrepreneurs have lower trust towards others, they may also be more likely to configure their entrepreneurial teams differently and less effectively than Greeve and Salaff (2003) observed over the motivation, planning, and running of business phases of entrepreneurs. Specifically, they may be less likely to interact with important network contacts beyond their strong ties (Granovetter, 1985). The result is likely that their network or team configurations lack sufficient links to key contacts that would otherwise provide them access to capital, information, or other resources. Young (1998) found that many black entrepreneurs do in fact configure their networks by assembling a small core of strong ties who aid them both in acquiring entrepreneurial resources, and in making important social and economic decisions. He encourages black entrepreneurs to increase the sizes and diversity structures of their networks in order to increase the amount of beneficial information and support that becomes available to them. Similarly, black entrepreneurs’ friendship configurations may more resemble Francis and Sandberg’s (2001) lower performers as they proceed through the various stages of venture formation. Perhaps even the team members in their personal network dyads convert differently and less effectively 34
than do more effective entrepreneurs’ dyads to Larson and Starr’s (1993) third stage. In this third stage, dyad members become layered with additional business functions, activities, and levels of exchange to the point where they could be rendered less effective and less positioned to secure favorable ratings from VC firms. Finally, black entrepreneurial teams may comprise a less than optimal degree of embeddedness within their social networks with other firms (Uzzi, 1996; Hansen, 1995).
2.3.2 Black Urban Entrepreneurship Urban retail scarcity Relative to other groups, the proportion of the black population living in inner cities is high (Sampson & Wilson, 2005). At the same time, poverty is most highly concentrated in urban areas. In 2000, 16.1 percent of central city residents lived under the federal poverty line, compared to 11.5 percent for the nation as a whole, and 78 percent of the nation’s poor lived in metropolitan areas, over half in central cities (Dalaker 2001). Hence, there is a need to examine black entrepreneurship taking into account inner city issues. This section will first present findings that show the inner city as a very unique market that offers robust opportunities for any entrepreneurs who reside there. Then, findings and discussion will be presented that explain how black entrepreneurs, in particular, may be predisposed to unique opportunity exploitation within this inner city market setting.
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Porter (1998) hypothesized that companies based in inner cities could achieve a distinct competitive advantage over suburban and other rivals because of certain characteristics in inner city communities. The characteristics are: centrality and proximity to transportation nodes, availability of labor, and unmet local market demand (Porter, 2005). Being transportation dependent, inner city residents more often use available retailers such as drug stores or smaller grocery stores to fulfill shopping needs (BCC and ICIC 1998, as cited in Weiler et al., 2003); Porter, 2004). Porter also noted that the national inner city population is equal to that of the state of Texas, and its retail market is worth $90 billion a year (Porter, 2005). Although median household income may be low in inner city areas, because of high population density, inner city areas concentrate more buying power into a square mile than do many affluent suburbs (Porter & Blaxhill, 1997). Average resident retail spending is $36 million per square mile, compared to $3 million per square mile for the rest of the metropolitan area (Porter, 2005). A 3.5-squaremile area of inner city Memphis, Tennessee has the same retail spending as the 700 square miles of a nearby urbanized Kentucky county (REDC, 1998, as cited in Weiler, Silverstein, Chalmers, & Lacey, 2003). Further, inner city households have under-appreciated buying power. Despite typical lower incomes of inner-city residents in marginalized communities, purchasing power is high. According to Weiler et al. (2003), low average household incomes are misleading because households with low income spend more than they apparently earn: The researchers explain, 36
This ratio of household expenditures to reported income is very large (around 4) for the poorest households, then declines as income increases to a ratio of approximately .6 for the most affluent households. (p. 1077) For example, firms consistently report underestimating food demand in inner city markets by 20 to 25 percent (Porter, 2004; Weiner et al., 2003). Weiler et al. (2003) explain how inner city households and markets are often underestimated, Inner city spending on retail is greatly underestimated if only comparative household average incomes are considered rather than expenditures. Common methods of reporting income –medians or averagesthus distort the market potential of a community and create misleading information about inner city neighborhoods, particularly given their relative density. The informal economy tends to be particularly important in struggling rural and urban populations, which can lead to significant undercounting of actual household income. (p. 1077) Weiler et al. (2003) also found that lower income communities in the innercity feature denser housing patterns and limited transportation options to distant suburban malls, which further concentrate spending power. Thus, Porter and Blaxill (1997) estimated that households in America's inner cities represented over $85 billion in annual retail spending power (excluding unrecorded income from legal activities). These researchers pointed out that the $85 billion is equivalent to nearly seven percent of total U.S. retail spending, and far more than Mexico's entire formal retail market. Weiler et al. (2003) observed that the informal economy tends to be particularly important in struggling rural and urban populations, and leads to significant undercounting of actual household income. An estimated $1 trillion 37
goes unrecorded in today’s economy through legal activities such as gardening, childcare, housekeeping, tips, and street vending representing most of this income (BCC and ICIC, 1998, as cited in Weiler et al., 2003). Retail scarcity describes the market environment in inner city markets. In spite of the purchasing power of inner-city markets, they are highly underserved by retailers and by financial services providers (Lee, 1999; Porter, 2005; Porter & Blaxill, 1997; Weiler et al., 2003). Porter and Blaxhill (1997) noted that these markets often lack the types of stores that inundate suburban areas, such as supermarkets, department stores, apparel retailers, and pharmacies, leaving an estimated excess of $25 billion of inner-city retail demand (30 percent) unmet. In some communities, such as Harlem, this proportion is as high as 60 percent (Porter & Blaxill, 1997). Porter and Blaxill (1997) emphasized that because of limited resident transportation options and limited local competition, inner city stores frequently offer less selection, higher prices, lower quality, inferior customer service and unappealing ambiance. The researchers estimated that inner city consumers often pay up to 40 percent more than other urban and suburban shoppers pay for basic grocery items. They also observed that the indignities that inner city consumers endure spending their hard-earned income contribute to the alienation from mainstream America that many feel (Porter & Blaxill, 1997). Porter attributes outsider reluctance to exploit inner city market opportunities to myths of bad workers, crime, and non-viable markets (2005). Similarly, Weiler et al. (2003) noted crime, government, and weak worker skills 38
as deterrents. Both researchers concluded that these common perceptions are misleading and lead to failure of outsiders to exploit lucrative business and profit opportunities.
Our research suggests that retailers' failure to respond to this market opportunity is a matter less of prejudice than of the absence of a strategy. We uncovered a number of challenges in inner cities that can deter market entry. Retailers are concerned about theft and other crime. They also often struggle with regulatory complications, community resistance and a neglected business infrastructure. Many inner-city neighborhoods are ethnically diverse, each group with its own preferences….These challenges have led many retailers to conclude that they can't make a profit in the inner city. Yet others have surmounted the challenges. They earn solid profits by simply bringing good retail practices to inner-city neighborhoods. (Porter, 2005, p. 1) Weiler et al. (2003) explained that inner city niche markets are hard for outsiders to analyze, and that they need to be analyzed as unique market areas. They contain informational gaps that obscure the profit potential of inner city areas to outsiders. Further, because of those gaps, in order to capitalize on entrepreneurial profits, outsiders must risk substantial slack resources (sunk costs) that may only yield social costs to society in general, while never yielding private returns to the investors. The result of these conditions is untapped profit potential of which local entrepreneurs are better positioned to take advantage of because of their information asymmetry (Weiler et al., 2003). The researchers also noted the following: Many communities rely on federal subsidies, grants, and loans, where they must emphasize their negative 39
attributes instead of their assets if they are to be funded. According to researchers for the Brookings Institution, ‘[t]his one-sided picture, in addition to contributing to the isolation and demoralization of inner-city neighborhoods and their residents, heavily contributes to the business sector's failure to look at inner-city neighborhoods as market opportunities’ (HUD 1999). (Weiler et al., 2003, p. 1078) As presented earlier, Weiler et al. (2003) and Porter (2005) emphasized that the profit potential of inner city markets is too big for outsiders to ignore, this study offers an alternative perspective. However, it is unlikely that the significant profit potential has gone unnoticed by insiders of those inner city communities. Instead, as the next two sections explain, black entrepreneurs may be exploiting the opportunities in such a way that is difficult for outsiders to observe and measure.
How urban market characteristics affect black entrepreneurship The section explores how varying levels of black population density among differing urban marketplaces may impact black entrepreneurship and opportunity exploitation. The section also explores varying levels of retail scarcity as if the variable is an estimate of a type of urbanism whereby unique opportunity exploitation among black entrepreneurs is likely prevalent. Cities and metropolitan regions vary in the proportion of their overall black populations that are concentrated in the inner city (i.e., black population density). Further, as black population density increases, the densest areas are likely to be located in inner cities. The literature above suggests that black population density and retail scarcity are positively correlated. 40
If Porter and Blaxill’s (1997; Porter, 2005) estimates are correct, then as much as $25 - $27 billion dollars are floating around in urban areas, where blacks are overrepresented, in search of retail goods. If Weiler et al.’s (2003) conjecture is accurate, then local black residents in those communities are best armed with information on where those floating dollars are, and for what goods and services the dollars are seeking. Additionally, given their high levels of entrepreneurial propensity (Butler, 1991; Herring, 2004; Walstad & Kourilsky, 1998), a high portion of black community residents are likely to be actively exploring how they might best exploit some of the resulting lucrative opportunities. Indeed, Reynolds et al. (2004) showed that among blacks, whites, and Hispanics, the positive relationship between urban residence and nascent entrepreneurship prevalence is strongest for black men and women. Moreover, Reynolds et al. (2004) found that population density, indirectly through population growth, has a positive and significant impact on prevalence rates for entrepreneurial activity. And, since black population density should positively relate to the proportion of blacks exploiting opportunities (from above), the relationship between retail scarcity, and the proportion of blacks exploiting opportunities should also be positive.
2.3.3 Black Entrepreneurship and Informal Economy Given the following: 1) that researchers perceive inner city retail demand as being grossly unmet; 2) the finding that black nascent entrepreneurs are more likely to engage in active search for opportunity exploitation; and, 3) that 41
the initiation rates of black men and women are nearly three times those of white men and women, and twice those of white women, then inner city black entrepreneurs are most likely recognizing and working to exploit opportunities within their communities. But, since the literature indicates that their business founding rates are lower than the national average, then some significant portion of their exploitation may be escaping research measurement. One plausible explanation is that a large percentage of those black entrepreneurs who are escaping measurement are exploiting opportunities in the informal economy. White and Reynolds (1997) found that blacks in Wisconsin show no differences in entrepreneurship rates compared to other groups. Comparison of this finding to Reynolds et al.’s (2004) finding to the contrary (that blacks have the strongest positive relationship between urban residence and nascent entrepreneurship prevalence) suggests that as blacks live in more rural areas, or in more mainstream areas, they are less likely to operate outside of the formal economy. Moreover, if, as Section 2.3.1 describes, black entrepreneurs operating in the formal economy consider themselves as being treated unfavorably as outsiders, they may remain in entrepreneurship, but may more so than other groups feel compelled to leave the formal economy (at least in part) and to operate in an alternative one. As a consequence, this section explores whether forces that push or pull entrepreneurs to found ventures in an alternative economy to the formal economy (i.e., in the informal economy) operate more strongly on black entrepreneurs than other groups.
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The informal economy has been labeled a variety of names: the “murky sector,” “urban-traditional sector,” “services sector,” “informal sector” (Gang & Gangopadhyay, 1990), “shadow economy” (Kuznetsova, 1998), and “unregistered economy.” It has been described as a dynamic actor in the process of economic development, frequently outpacing the growth of the formal modern sector (Gang & Gangopadhyay, 1990). The informal economy refers to “economic activity that is not statistically recorded, and includes: 1) lawful activity that is concealed or played down by producers in the interest of evading taxes or fulfilling other lawful obligations; 2) unofficial but lawful activity (family enterprises working for their own needs and temporary teams of builders), and 3) legal types of activity that the population engages in illegally, for example, without licenses” (Kuznetsova, 1998, p. 21). The informal economy is estimated to account for the following proportions of the following countries' national accounts: 2 to 7.5 percent for Great Britain, 10 percent for France, 15 percent for Italy, 25 percent for Russia (Kuznetsova, 1998), and 3 to 8 percent for the U.S. (Smith, 1981; Weiler et al., 2003). At an even more extreme level, more than half of Peru's population conducts its personal and commercial affairs in the informal sector, owing to excessive bureaucracy and government regulation (Schuck & Litan, 1987). Antecedents of the informal economy include excessive bureaucracy and regulation (Schuck & Litan, 1987), and formal market incapacity to satisfy the basic needs of the impoverished masses (De Soto, 1989). This economy may also be substantially sustained by purchases from people in the formal economy 43
who need not retain receipts for purchases. This type of purchasing is in contrast to corporate purchases for example that are required to be documented and accompanied by purchase receipts. Consequences of the informal economy include: understated income (Weiler et al., 2003), negative impacts on effectiveness of monetary policies, unexplained growth in currency, and overstated unemployment rate because many of the statistically unemployed might actually be employed in the informal market (Smith, 1981). De Soto (1989) argued that the informal economy is erroneously thought of as a problem where companies and industries compete unfairly with formal economy companies and industries that obey regulations and pay taxes. Instead, he argued that the informal economy serves as a regulating mechanism providing impoverished masses with a means to obtain, not only economic, but social freedom as well. A broad range of activities are increasingly provided informally. These services include household, communal, and underground activities (Gershuny, 1979). Given the range of activities in various sectors of the informal economy, along with the economic, technological, and cultural forces encouraging them, any view of the formal economy which does not take account of these developments will be a distorted one (Gershuny, 1979).
Relative experience and serial entrepreneurship This section relates to the experience levels of entrepreneurs. As discussed earlier, Butler (1991) explains that the initiation rates of black men and 44
women are nearly three times those of white men and women, and twice those of white women. Also, if blacks are more likely to recognize opportunities through externally-stimulated processes (Singh, Knox, & Crump, 2008), then it follows that they more often search for opportunities to exploit. The literature does not yet address nor measure how much success these entrepreneurs have in identifying plausible opportunities. Nor does the literature address if black entrepreneurs take the same process paths that other entrepreneurs take in exploiting their opportunities. The literature only addresses the lower rate of black venture founding, and the higher rate of exit (or death) of these ventures. What is missing is all that happens in between the higher rate of searching for entrepreneurial opportunities, and the lower rate of founding and/or venture viability. So, while researchers and scholars cannot say exactly what is happening in between, it is clear that something is happening that prevents blacks from founding new ventures. It may be that black entrepreneurs may in fact be more likely to embrace entirely different entrepreneurial pathways than the literature indicates. Serial entrepreneurs are those who repeat the process of starting new ventures, thereby engaging in multiple start-ups (Wright, Robbie, & Ennew, 1997). So, although in Brush, Monti, Gannon, and Ryan’s (2006) investigation, only 40 percent of blacks were running a business other than their first startup, compared to 77 percent of whites, their findings relate to established ventures only. It may be that black entrepreneurs are highly likely to be serial nascent entrepreneurs. 45
One reason that supports the suggestion of high serial entrepreneurship rates among black entrepreneurs is that given the established high exit rates of black entrepreneurs, and their rates of firm deaths, each death must have been preceded by a founding. However, we do not know whether the reasons for firm deaths were more or less assigned to poor opportunities, poor exploitation, undercapitalization, or some other circumstance such as transferring the venture into the informal (unregistered) economy. In addition, from similar lines of reasoning, particularly given their increased incidences of opportunity searching and subsequent activities, we may conclude that black entrepreneurs may have a substantial degree of expertise in terms of Ronstadt’s (1988) corridor principle. According to this concept, once an entrepreneur exploits one venture, the entrepreneur finds him/herself traveling in a metaphorical corridor where windows of new opportunities constantly present themselves to the entrepreneur for exploitation. Based on the above arguments, what we may also reasonably conclude is that a substantial portion of black entrepreneurs, relative to white entrepreneurs, may be categorized as serial entrepreneurs.
Black population density, retail scarcity, and informal economy exploitation The arguments presented in section 2.2.2 suggest that as black population density increases, the percentage of blacks exploiting opportunities in a region is likely to be overrepresented in the informal economy. Hence, relative to areas of low black population density, the proportion of blacks exploiting opportunities in the formal economy may be lower. And, since retail scarcity and 46
black population density are most likely positively related (from above), as retail scarcity increases, the proportion of blacks exploiting opportunities in the formal economy is likely to decrease. Whereas, as retail scarcity decreases, the proportion of black exploiting opportunities in the informal economy is likely to increase.
Black distrust So, as black population density increases, levels of low trust (or distrust) may become increasingly concentrated into smaller geographic areas. The process of increased concentration in and of itself is likely to further accentuate levels of black distrust in an exponential manner. In turn, as black distrust increases, a large portion of black entrepreneurs may similarly exit large portions of their entrepreneurial activities from the formal economy, opting to trade significantly more so in the informal economy (Note that the activities of all individual entrepreneurs exist on a continuum marked by fully informal on one extreme, and fully formal on the other. Hence, any given entrepreneur’s activities may be more or less formal or informal than any other entrepreneur’s). This dynamic would likewise help to explain a substantial portion of the underrepresentation of black entrepreneurship in the formal economy. If, as the literature indicates, blacks are more likely to possess low trust tendencies than other groups, they may also be more likely to understate or overstate their information as survey respondents. Blacks in the formal economy may also be more likely to understate “good” information, and overstate “bad” 47
information. For example, they may be more likely to understate earnings, and overstate amount of taxation place on them. Then, it also follows that blacks in the informal economy may be particularly more likely than others non-blacks in the informal economy to evade capturing of relevant economic information.
Disparity in perceptions of corruption Acemoglu and Verdier (2000) argued that because governments try to tax some activities while subsidizing others in order to prevent market failures, that the intervention inadvertently creates corruption opportunities, rents for public employees, and misallocation of resources. These actions in turn increase the size of government and public sector wages. However, as Choi and Thum (2005) illustrated, the informal economy helps to regulate corruption, and it contributes to market success: The entrepreneurs' option to flee to the underground economy constrains a corrupt official's ability to introduce distortions to the economy for private gains. The unofficial economy thus mitigates governmentinduced distortions and, as a result, leads to enhanced economic activities in the official sector. In this sense, the presence of the unofficial sector acts as a complement to the official economy instead of as a substitute. (p. 832) As Porter and Blaxill (1997) observed, as the incidence of retail scarcity increases, local residents are more likely to feel alienated from mainstream America. In turn, this alienation is likely to contribute to increased perceptions by blacks of the prevalence of corruption. Therefore, this study proposes that as
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perceptions of corruption and alienation increase among blacks, that blacks are more likely to opt out of trading in the formal economy.
Perceptions of firm performance This section now explores whether any variation exists in how the construct firm performance is perceived among black entrepreneurs relative to other groups of entrepreneurs. Firm performance is typically conceptualized in terms of financial profitability results (Post, Preston, & Sachs, 2002). Large, publicly traded corporations in particular measure firm performance from an Income Statement and Balance Sheet perspective, producing periodic financial statements that can be used to measure and track growth, profit margins, and productivity. In contrast, small and privately owned organizations are less likely to publish their financial information in formats that are available for comparison (Rhodes & Butler, 2004) because they lack the same incentives for showing profit on paper as their counterparts. Hence, small, privately owned businesses are associated with actions characteristic of entrepreneurial behaviors (Gyoshev, Manev, & Manolova, 2005; Hornaday & Wheatley, 2001). Owners of these firms are likely to manipulate firm resources in ways that minimize income statement profit and growth potential (Fishman, 1995a; Hornaday & Wheatley, 2001; Rhodes & Butler, 2004). Small business owners endeavor to generate profits like most other owners; however, this study suggests that they differ by engaging in more intuitive gauges of firm performance. Performance indicators salient to these 49
owners are likely to be more subjective and different than some of the more objective financial ratio indicators used more often by their counterparts. Small business owners may view firm performance in terms of growth in: number (or type) of customers, number of employees hired, degree of amicable relations with various constituents or stakeholders, reputation, and degree of leadership provided to community organizations (Fishman, 1995a; 1995b; Hornaday & Wheatley, 2001; Rhodes & Butler, 2004; Robinson, Blockson, & Robinson, 2005). Rhodes and Butler (2004) proposed that for black entrepreneurs, perceptions of business performance include a wide range of expectations, and are a function of both socioeconomic environments and managerial skill. These researchers posit that socioeconomic resources in the community affect entrepreneurs’ self-perceptions of business success and lucrativeness through influences on their business decisions. In studying successful black entrepreneurs, Adams and Sykes (2003) found that both financial and nonfinancial measures are integral parts of the management strategies employed by successful black entrepreneurs. Among the financial measures, cash flow was perceived to be most important, followed by net income and the ability to obtain financing. Among the non-financial measures, customer complaints was perceived as most important, followed by employee loyalty, lost customers, and new customers. These researchers also found that black entrepreneurs include family and religion in their top 10 factors for success.
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Similarly, Singh and McDonald (2004) found that black nascent entrepreneurs differ from white nascent entrepreneurs in that they are more likely to report choosing entrepreneurship to: gain a higher position for themselves, lead and motivate others, have power to influence organizations, and help their families. These researchers also observed that blacks are less likely to enter into entrepreneurship strictly for economic reasons than whites. Singh and McDonald’s (2004) findings suggest that black entrepreneurs may: score high on perceptions of control and self-efficacy, have low-trust or confidence in placing their income security into another person’s control, and may be mismatched working within the confines of any structure other than their own. This discussion highlights the importance of considering what the perceived and/or actual firm performance implications are for whether a black entrepreneur operates in the formal or informal economy. It may be that people vary in their views on whether operating in one economy is more likely to outperform operating in the other. If people do vary in this perception, and if, in reality, operating in one of the two economies does in fact outperform operating in the other, then those who operate based on the perception mismatched with reality will experience unfavorable entrepreneurial outcomes. Consider, for example, if an entrepreneur acts on the perception that he can more optimally exploit a business venture by operating in the informal economy, and if in reality the opposite is more accurate, then the entrepreneur foregoes an optimal level of venture exploitation. Moreover, people vary in how they compute the moral value of a business decision. For example, if the entrepreneur is an egoist, a 51
utilitarianist, or a consequentialist, (and not a Kantian deontologist) his ethical lenses may justify his exploiting entrepreneurship in the informal economy based on his instrumental perceptions concerning the outcomes for his actions. What this discussion highlights is that some entrepreneurs may not find it morally wrong to exploit ventures in the informal economy. Instead, they may view this decision strictly from a cost-benefits analysis perspective, or may in fact even view the decision as possessing high moral value based on its perceived outcomes. However, right or wrong aside, helping entrepreneurs to increase the accuracy of their perceptions and their reasoning should help to minimize cases where entrepreneurs erroneously conclude that operating in the informal economy proves to be an optimal choice, if the opposite proves true. Moreover, if black entrepreneurs are more likely than other entrepreneurs to operate in the informal economy, then because of this higher percentage, they may also be more likely than others to make such errors. Accordingly, some of these entrepreneurs may not be aware of certain positive future benefits and impacts that operating in the formal economy has on securing sufficient financing for future business growth and maintenance needs that will likely arise. And some may not be aware of benefits that operating in the formal economy affords in terms of securing more solid assets for long-term growth and viability, such as land, plant, and equipment. Instead, they may view as more beneficial keeping the majority of one’s business assets comprised of primarily liquid assets mainly for the purposes of averting detection of informal operations. The position of the current study is not to advance any normative 52
claims by choosing a moral side of either choice. Instead, the aim of the current research is to emphasize the instrumental aspects of both choices.
Alternative Trade Processes Much of the discussion so far suggests plausibility to the notion that a significant portion of black entrepreneurs operate in an altered type of economic trade system where the function of the construct money is altered. Such a system likely comprises a dual economy where the traditional mechanism of trade (products and services being exchanged for printed money) is complemented by trade processes that are not dependent on printed money. In that system, loose, verbal agreements and trade may take an equal place alongside cash as a medium of exchange. For example, one member in a two-party trade transaction might say to the other, “I’ll do this for you, but you owe me!” In that agreement, the former member grants credit to the latter, who in turn agrees that a future (unstated) reciprocated product or action will serve as payment. Note that both actions, the “I’ll do this for you…” and the reciprocated action, involve transference of a product and/or service which in the formal economy would be traded in exchange for money, recorded, and taxed. However, in the unregistered (informal) economy, no money in the traditional sense has been exchanged, no recording of the transaction has occurred, and no tax payments have accrued. Thus, at face value, transactions in the informal economy appear to have become cheaper; thereby increasing the purchasing power of trade members’ disposable 53
income while at the same time making the act of transacting more dependent on perceptions of mutual trust and equitable intentions. Additionally, traditional demands for working capital become less relevant, helping to negate the undercapitalization and underresourced state of black entrepreneurs that is wellestablished in the literature. Some research has found no difference in the types of businesses that black entrepreneurs exploit relative to other groups (for example, Köllinger & Minniti, 2006). However, other research has identified differences. Lee (1999), for example, found that black merchants dominate in the hair-care services, music, and restaurant industries. Of these industries, the restaurant industry contains the greatest restraining forces to informal economy exploitation. The reason is because restaurants are heavily regulated by state health agencies, and because merchants’ trade locations (including mobile food providers) are highly visible. The remaining two industries, hair-care services and music, provide trade environments that are conducive to providing entrepreneurs choice of operating in either the formal or informal economy, or in both. Other industries that provide similar choices are automotive repair (e.g., body and fender), home improvement contractors (e.g., drywall, plumbing, carpentry), residential maintenance services (e.g., lawn care maintenance, chimney service), retail outlets (e.g., clothing, eye wear, jewelry, accessories, compact discs) and, transportation hacking, among others. Based on the above discussion, this study offers, for future research inquiry, a unique model of black entrepreneurship exploitation particularly in 54
inner city markets (see Figure 2). The model suggests that six factors provide push forces that lead blacks, more so than other groups, to operate at least in part in an informal economy. The factors are intense levels of: black population density, retail scarcity, black distrust, and perceptions of corruption in others; and differences in trade behaviors, and perceptions of performance. This study also suggests that these forces act more strongly on black entrepreneurs than most other major ethnic or racial groups in the U.S.
Informal Economy
Population Density
Black Distrust
Retail Scarcity
Formal Economy Trading Differences
Performance Perception Differences
Corruption Perceptions
Informal Economy
Figure 1: Model of Black Entrepreneurship: Six Push Factors Toward Entrepreneurship in the Informal Economy 55
2.4 Conclusions The discussion above suggests that a discrepancy exists within the entrepreneurship literature and the actual business landscape as they relate to black entrepreneurship. The literature shows that blacks are underrepresented in successful entrepreneurship, they control fewer assets, and they have less access to capital. Yet, the literature also shows that blacks score high on entrepreneurial propensity, and that their spending power tends to be underestimated and ignored. Finally, the literature suggests that blacks are in fact contributing substantially to the U.S. national account. However, that they are doing so, and the comprehensive picture of how and to what degree they are doing so, remains largely non-captured by the extant entrepreneurship literature. What is firmly established is that successful black entrepreneurship is largely lacking in the U.S. formal economy. Relatively few studies in the major entrepreneurship research outlets, or elsewhere, address issues and problems that shed substantive light on this underrepresentation of blacks in entrepreneurship. In as much as what little we do know about black entrepreneurship comes from empirical studies of entrepreneurs who operate mainly registered businesses, most of the existing knowledge pertains to predominately noninformal-economy entrepreneurs. Perhaps, because the informal economy remains out of sight to many researchers and academics, it also remains out of mind. Moreover, because of difficulties in measuring the informal economy, 56
many academics may shun its existence as insubstantial or insignificant. Nonetheless, such largely stealth activities are likely to be quite salient to community members, policing officials, state comptrollers’ taxation, licensing, and regulating agencies, prosecuting state’s attorneys, competing businesses, and religious institutions, among other similar groups. In keeping with Ireland, Reutzel, and Webb’s (2005) proclamation, “…we think that future entrepreneurship scholarship may also be influenced by researchers’ desire to examine a question Rumelt (1987) (among others) raised: Where do new businesses come from?” (p. 562), this study suggests that a potentially large portion of these new businesses come from either: 1) businesses existing in the informal economy; or, 2) from entrepreneurs that are measured as nascent or first-time entrepreneurs in the formal economy, but whom are actually serial entrepreneurs when the informal economy is taken into consideration. Thus, discussion in this section proposes that black entrepreneurship may be thriving in the informal economic sector. However, in light of the dearth of research existing on these under the radar entrepreneurs, these conjectures remain speculative at best. The problem with all of the questions raised in this section is, we simply do not know whether, and if so how, any of the related differences impact the black entrepreneurship founding rates because of the lack of research focusing on black entrepreneurship. We also do not know whether there are any other differences between black and white entrepreneurs in terms of some of the other entrepreneurship constructs (e.g., cognitive processes) that drive differences in 57
the founding rates of black relative to white entrepreneurs. This dearth of research effort addressing the problem exists in spite of obvious societal and economic benefits derived from spurring new black business. Thus, this dissertation emphasizes the need for increased scholarship on black business and entrepreneurship issues, particularly as a means to eliminating the underrepresentation of blacks in formal entrepreneurship, and to eliminating the accompanying perils resulting from that underrepresentation. The suggested theoretical relationships in this section should lead future research to identifying some of the drivers for the substantial differences between the entrepreneurial processes of blacks in the U.S. relative to other groups of Americans. A plausible discovery may be, whether or not opportunity recognition processes of blacks who trade predominately in the informal economy differ from those who trade (predominately) in the formal economy. Or, this work may inspire researchers to inform policy on how to aid black entrepreneurs who may operate in the informal economy but wish to switch over into the formal economy; yet fail to do so because they perceive themselves as having insufficient resources to make the conversion. Finally, a plausible outcome resulting from this work would be further understanding of the role that population density and retail scarcity play in the underrepresentation of black entrepreneurship.
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3.0 RESEARCH METHODOLOGY
This section describes the study’s methodology. As previously explained, the first of the two major parts of the dissertation comprises an exhaustive literature review of all papers in the major entrepreneurship publication outlets that provide knowledge on black entrepreneurship. This was done in Section 2.0. The second part of this dissertation provides empirical analyses of all entrepreneurship journal articles published during the 12-year period from 1995 to 2006. The top entrepreneurship intellectual contribution outlets were manually inventoried. This list of top entrepreneurship journal outlets (see Table 3.1) was compiled by combining the lists identified by Harzing (2006), Katz (2003b; 2006), and Shane (1997). Each proceeding for the top three long-running U.S. annual entrepreneurship conferences listed in Katz (2003b) were also manually inventoried. The conferences are the Babson College Entrepreneurship Research Conference (Babson), the United States Association for Small Business and Entrepreneurship Conference (USASBE), and the University of Illinois at Chicago/American Marketing Association Symposium on Marketing and Entrepreneurship (UICAMA). Teaching cases, instructors’ notes, invited commentaries, and book reviews were omitted from the dataset. Only peerreviewed, non-invited papers were included in the dataset.
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Table 3.1: Top 26 Journals for Entrepreneurship Publication Academy of Management Journal Academy of Management Review Administrative Science Quarterly American Journal of Sociology American Sociological Review California Management Review Economics of Innovation and New Technology* Entrepreneurship and Regional Development* Entrepreneurship Theory & Practice* Harvard Business Review Industry and Innovation* International Small Business Journal* Journal of Entrepreneurship*
Journal of Small Business Mgmt* Journal of Business Venturing* Journal of High Tech Mgmt Research* Journal of Management Journal of Management Studies Journal of Small Business Economics* Management Science Organizational Dynamics Organization Science Organization Studies Sloan Management Review Stanford Social Innovation Rev. Strategic Management Journal
* Denotes entrepreneurship-specific journals.
Some of the 26 journals are entrepreneurship-specific journals, and the others are broader management journals. All articles that were published in all of the entrepreneurship-specific journals were added into the dataset. For the broader management journals, only those articles written on entrepreneurshiprelated topics were included in the dataset. To determine which articles in the broader management journals were written on entrepreneurship, the researcher conducted an electronic search using two search engines, ABI/INFORM Global™ and EBSCO Publishing’s Business Source® Premier. A series of electronic searches were conducted within each journal. If any search term was contained in the body of a paper or in the paper’s citation information, the paper was examined to determine if it was written on an entrepreneurship-related topic. The following search terms were used: “entrepreneurship,” “entrepreneur(s),” “intrapreneurship,” “intrapreneur(s),” “intrapreneurial,” “small business management,” “new business enterprise(s),” “self-employment,” “venture capital,” 60
“business incubators,” “incubators,” “business enterprises,” “venture,” “venturing,” and “ventures.” After all entrepreneurship articles and papers were identified, the following information was manually collected: For each article1 •
authors’ names
•
authors’ affiliations2
•
page counts
•
whether the paper provided knowledge on black entrepreneurship
•
whether the study was empirical or conceptual
•
whether opportunity recognition was a/the major construct emphasized
•
whether the research indicated funding by outside sources.
For each affiliation •
country of affiliation
•
whether the affiliation was an HBCU, or a non-HBCU.
After all data was collected, rank listings of all authors and institutional affiliations were computed using the methodologies used by Chan, Chen, and Cheng (2006), and Shane (1997). The rankings were determined using weighted numbers of papers as the primary measurement metric (weighted by number of co-authors and co-affiliations for each paper). Weighted number of papers was 1
At the time of data collection, only summary citation information was available for all USASBE papers. Some Babson proceedings papers were one page summaries.
2
Author affiliations were determined by the institution(s) listed on the table of contents, and/or the first page of the article. If at the end of an article an author’s additional joint appointment was indicated, the appointment was not added to the author’s affiliation.
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used to control for high numbers of publications among authors who wrote articles with many co-authors (Shane, 1997). To compute the weighted number of papers ranking lists for authors, each article was first divided by its number of authors. Then, each of the authors was assigned a corresponding weighted score for every article they authored either individually or with co-authors. For example, an author who wrote an article with two other co-authors was assigned a weighted score of .33. Whereas another author who wrote an article with only one co-author, received a weighted score of .5. After all articles were given weights, all the weights assigned to each author were summed. The resulting weighted score list was then rank ordered from greatest to least. Using the same methodology, rank listings were computed for institutions. Similarly, following Chan et al. (2006) and Shane (1997) in cases of multiple author affiliation, publication credit was evenly shared among an author’s institutions. If, for example, an article was written by two authors where the first author had two affiliations, and the second author had only one, then the first author’s two affiliations received a .25 credit each (.5 ÷ 2), and the latter author’s affiliation received a .5 credit. In such cases, the authors each still received a .5 credit each. The statistics for both weighted and non-weighted computations are displayed throughout the rankings results tables. Authors writing conference proceedings papers were not assigned equal weights to those of journal papers. Instead, these papers were adjusted down. Conferences proceedings papers command lower stringency requirements, and 62
they typically represent an earlier stage of development than peer-reviewed and accepted journal articles. Therefore, all weights on conference papers were first computed using the same procedures above, but afterwards, the computations were weighted down to one-tenth (1/10th) the value of journal articles. For example, an author of a proceedings paper who had only one co-author was initially assigned a .5 weight for that paper (one paper divided by two authors equals .5). This .5 was then weighted down by one-tenth to .05). Weighted and non-weighted statistics are displayed throughout the tables. As a secondary measurement metric, rankings were computed according to adjusted page count. For journals, a Journal of Business Venturing (JBV)equivalent page was computed for each journal article borrowing Chan, Chen, and Steiner‘s (2004) methodology for computing equivalent pages. This method consists of determining the word counts for three randomly selected typical pages that have no equations, footnotes, or graphs, from each of the journals. By comparing the average JBV words-per-page count to that of the other 25 journals, each resulting ratio constitutes a JBV-page equivalent number. For example, an average JBV-page was computed to contain 538.33 words, and an average Journal of Small Business Management (JSBM) page was computed to contain 500 words. Therefore, a JSBM page constitutes a JBV-page equivalent of .93. Thus, a 20 page JSBM article would constitute a JBV-page equivalent of an 18.6 page article. After JBV-page counts were computed for all articles, they were weighted according to both number of co-authors and co-affiliations in order to compute the secondary measurement metric. 63
Similarly, JBV-page counts were computed for all three conference proceedings, with equivalent ranking tables developed and listed. Once this ratio statistic was computed for all proceedings papers, each was divided by its corresponding authors and affiliations to derive their weighted JBV-page count rankings. Then, the subsequent rankings lists were weighted down to 1/10th the value of journal articles. The final step here was to synthesize the journals and proceedings rankings to comprise single JBV-page ranking lists for authors and affiliations. In Section 7.0, Tables 7.1 through 7.4 show the rankings for Top 25 authors and Top 25 affiliations publishing in the entire dataset. The rankings are based on numbers of weighted papers and pages. The subset of researchers and affiliations who published papers on black entrepreneurship topics were likewise ranked by weighted papers and pages published on the subject. These results are presented in Section 4.0. Tables 4.1 through 4.4 rank all of these researchers and their affiliations. An exploratory comparative analysis was also performed to determine if affiliations having certain attributes were producing significantly differently in key entrepreneurship publication outlets than their counterparts. The two attributes analyzed were country status (U.S. versus Non-U.S. institution), and HBCU status (HBCU versus Non-HBCU). Differences that relate to country status are also discussed in Section 7.0. Tables 7.5 through 7.8 show the rankings for the Top 25 U.S. and Non-U.S. affiliations. Results that relate specifically to HBCUs are highlighted and discussed in Section 5.0. Table 5.1 ranks all HBCU
64
researchers who published entrepreneurship papers in the dataset. Tables 5.2 and 5.3 rank all HBCUs that published entrepreneurship papers in the dataset. The final empirical step comprises supplementary research that analyzes only those papers that are written on opportunity recognition. A major component of any entrepreneurial venture is the recognition of the opportunity by the entrepreneur (e.g., Bhave, 1994; Hills, 1994; Shane & Venkataraman, 2000; Timmons, 1994). In Shane and Venkataraman’s (2000) highly influential AMR article which proposed boundaries on the field of entrepreneurship, and the distinctive domain of entrepreneurship research, opportunity recognition is presented as a central part of the entrepreneurship process. The authors define entrepreneurship as “the scholarly examination of how, by whom, and with what effects opportunities to create future goods and services are discovered, evaluated, and exploited (Venkataraman, 1997).” (p. 218). Shane and Venkataraman (2000) encourage researchers to explore their framework, thereby joining in the “quest to create a systematic body of information about entrepreneurship.” (p. 224). Section 8.0 provides supplementary analyses focused on authors and affiliations associated with opportunity recognition papers published from 1995 to 2006. The interest in this section is to examine opportunity recognition research within the literature. More specifically, the focus is centered on the question of how much of an impact did the Shane and Venkataraman (2000) article have on the field. The reason why the construct opportunity recognition is selected for supplementary analyses lies in its importance to the entrepreneurship process, 65
and its treatment in the literature. Opportunity recognition is imperative to the process of entrepreneurship in that, in the absence of this construct, entrepreneurship could not exist. Moreover, as Shane and Venkataraman (2000) emphasize, one of three questions about entrepreneurship that organization scholars are fundamentally concerned with is: Why, when, and how some people and not others discover and exploit opportunities for the creation of goods and services?. Research productivity on opportunity recognition is measured in the time periods before the article was published (Period 1: 1995 – 2000), and after the article was published (Period 2: 2001 – 2006). The goal was to see if there has been a major shift in opportunity recognition research in response to the article. It was expected that based on the magnitude of the article’s influence, that the frequency of papers published on opportunity recognition would be significantly greater during the years following the publication than during the years prior to, and including, the publication. Findings are presented and discussed. Tables 8.1 through 8.10 show rankings, and longitudinal results on researchers and affiliations who published in this area.
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4.0 SURVEY OF THE BLACK ENTREPRENEURSHIP LITERATURE
This section summarizes the empirical results on the black entrepreneurship literature contained in the major entrepreneurship publications from 1995 to 2006. It provides rankings on all authors and affiliations that published any papers in the dataset that advanced knowledge on black entrepreneurship. Later in Section 6.0, detailed summaries and discussion of each paper are provided. An estimated 20,969 articles and papers were published on management, business, and entrepreneurship from 1995 through 2006 in the 29 outlets analyzed in this study. Only those 5,909 papers that were written on entrepreneurship were examined in this study. So, while all 20,969 papers were not specifically examined, all entrepreneurship papers were examined. Out of these, only 13 were written on black entrepreneurship. Thirteen papers out of 21,000 papers amounts to just .062 percent of the total knowledge in the major intellectual outlets being dedicated to black entrepreneurship. The 29 journals and conferences examined in this study are the leading outlets for management and entrepreneurship research. Yet, the bulk of black entrepreneurship journal articles that are being published are getting published in smaller, less well-known outlets. For example, 20 of the approximately 167 papers published in the Review of Black Political Economy during the same 12year investigation period were published on black entrepreneurship.
67
The 13 papers also represent just .22 percent of the papers specifically published on entrepreneurship: That is, one-fifth of one percent of the total 5,909 entrepreneurship papers analyzed in this study were dedicated to black entrepreneurship issues. These 13 papers were written by a total of 29 authors who were associated with 21 affiliations (see Tables 4.2 through 4.5 for rank listings of the Top Authors and Affiliations). None of the papers were published by HBCUs. The papers were written by researchers of 20 U.S. institutions, and one German institution. To this researcher’s knowledge, no prior studies have empirically verified just how under-researched black (American) entrepreneurs remain. One result of the empirical finding discussed above is that it may help stimulate other researchers to develop new knowledge in this critical area, and it may stimulate publication gatekeepers to facilitate increases in black entrepreneurship literature. Currently, it is not clear whether the dearth of research on black entrepreneurship exists because black entrepreneurship topics are simply viewed as unpopular and/or less relevant to editors and reviewers of journal articles. There is no reason to believe that scholars are not researching the subject, and they are likely to have submitted more than 13 papers on black entrepreneurship to the major entrepreneurship outlets during the 12-year period. It may be that such papers are of equal academic rigor, but they are not recognized as such. Nonetheless, 13 is the actual number of papers on the topic that have been accepted by these outlets from 1995 through 2006. All other papers published on black entrepreneurship have found homes elsewhere. Yet, 68
the importance of increased research investigating the contradictory findings on black entrepreneurship remains unaddressed in the major entrepreneurship outlets. It may be time for special issues on the topic of black entrepreneurship to be undertaken in the major entrepreneurship outlets. But, ultimately, the literature and society stands far more to gain if full inclusion of academically qualified studies in this critical research area becomes the goal of scholars and publishers.
4.1 Descriptive Attributes of Black Entrepreneurship Papers Table 4.1 provides a summary of descriptive attributes for the 13 papers written on black entrepreneurship. Six of the papers were published in academic journals, and seven were published in Babson College’s Frontiers of Entrepreneurship Research conference proceedings. All 13 of the papers were empirical studies. Three of the 13 papers were written in Small Business Economics, and one paper each was published in the journals, American Sociological Review, Entrepreneurship Theory and Practice, and Journal of Small Business Management. The remaining seven of the papers appeared in Babson’s Frontiers of Entrepreneurship Research. The authors for six of the 13 papers indicated that their research was funded. These funded studies were written by 14 of the 26 authors, and these 14 authors represented 10 different affiliations (see Table 4.1). Two additional papers did not report funding (Köllinger & Minniti, 2006; and Crosa et al., 2002).
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Table 4.1
Descriptive Attributes by Paper
Year
Journal
Article Title
# of Authors
# of Affiliations
Funded
1996
ASR
Self-employment and the Earnings of Immigrants.
2
2
Yes
1998
ETP
Entrepreneurial Attitudes and Knowledge of Black Youth.
2
2
2006
JSBM
African American Small Business Owners’ Attitudes Toward Business Training.
4
Not for Lack of Trying: American Entrepreneurship in Black and White.
Author(s)
Affiliation JHU + UCLA
-
Portes & Zhou Walstad & Kourilsky
2
-
Martin et al.
UAB + CBW
2
2
-
Kollinger & Minniti
Bbsn + GER
Entrepreneurship and Earnings among Young Adults from Disadvantaged Families.
1
1
Yes
Fairlie
UCal
2004
Recent Trends in Ethnic and Racial Business Ownership
1
1
Yes
Fairlie
UCal
2006
Inner City Entrepreneurs: Building Ventures and Expanding Community Ties.
4
2
Yes
Brush et al.
Bbsn + BU
2005
African American Women Entrepreneurs And Firm Growth: New Theoretical Directions At The Intersection Of Race, Gender, And Firm Growth.
3
3
Yes
Robinson et al.
NYU + UNI + IWU
2004
The Prevalence of Nascent Entrepreneurs in the United States: Evidence from the Panel Study of Entrepreneurial Dynamics
4
3
Yes
Reynolds et al.
Bbsn + UST + USC
3
2
-
2
2
-
Crosa et al. Galbraith & Stiles
OSU + UNC UNCw + CalSU
1
2
-
2
2
-
Young White & Reynolds
CW + UC UWM + Bbsn
2006 2005
SBE
UNL + Kaufmn
70 Babson 2002 1999
1998 1997
Is There a Wealth Affect? Financial and Human Capital as Determinants of Business Startups. Entrepreneurial Behavior of Freed Slaves: Post Civil War Southern States. The Structure and Substance of African American Entrepreneurial Networks: Some Preliminary Findings. Factors Inhibiting Ethnic Participation in the Entrepreneurial Process.
Key for Table 4.1
Journal (Publication Outlet) Acronym
Journal (Publication Outlet) Name
Affiliation Acronym
Affiliation Name
71
ASR
Administrative Science Quarterly
Bbsn
Babson College
Babson
Babson College Entrepreneurship Research Conference Proceedings
CalSU
Calif. State Univ., Bakersfield
ETP
Entrepreneurship Theory & Practice
CBW
Computer Builders Warehouse
JSBM
Journal of Small Business Mgmt
CW
College of Wooster: Ohio
SBE
Journal of Small Business Economics
GER
German Inst. for Econ. Rsrch
IWU
Illinois Weslyan Univ., Blmgtn
JHU
Johns Hopkins University
Kaufmn
Kauffman Ctr. for Entrepr'l Ldrshp
NYU
New York University
OSU
Ohio State University
UAB
University of Alabama
UC
University of Chicago
UCal
University of California, Santa Cruz
UCLA
University of Calif., Los Angeles
UNC
University of North Carolina
UNCw
University of NC, Wilmington
UNI
University of Northern Iowa
UNL
University of Nebraska-Lincoln
USC
University of Southern Calif.
UST
University of St. Thomas
UWM
Univ. of Wisconsin–Milwaukee
Yet, the data collection for both of these studies was funded. One of these studies used funded Panel Study of Entrepreneurial Dynamics (PSED) data, and the other study used funded Global Entrepreneurship Monitor (GEM) data. These two papers that did not indicate funding, and four of the six funded studies used nation-level data. For the remaining two funded studies, one (Brush et al., 2006) looked at 29 entrepreneurs in the Boston, Massachusetts inner city area, and the other (Robinson et al., 2005) looked at 62 entrepreneurs in seven U.S. metropolitan areas. Young (1998) was the only author during the time period to publish a paper on both black entrepreneurship and opportunity recognition. His dual affiliation consisted of the University of Chicago, and the College of Wooster in Wayne County, Ohio. Thus, these two universities are the only two affiliations that produced knowledge on both black entrepreneurship and opportunity recognition within the dataset.
4.2 Rankings on Black Entrepreneurship Researchers and Affiliations Robert W. Fairlie of the University of California, Santa Cruz was the most prolific researcher publishing on black entrepreneurship in the major entrepreneurship publication outlets in terms of quantity of contribution (see Table 4.2). With a weighted value of 2.0, Fairlie outpaces all other researchers in weighted papers written on the subject. Trailing Fairlie in second place are six researchers, each of whom published .5 (i.e., one-fourth of Fairlie’s total) 72
weighted papers on the subject. These authors, in alphabetical order are, P. Köllinger, Marilyn L. Kourilsky, Maria Minniti, Alejandro Portes, William B. Walstad, and Min Zhou. Next, in eighth place is Paul D. Reynolds with .3 weighted papers. The remaining 21 authors wrote between .025 and .25 weighted papers on the subject. The rankings results for weighted number of JBV-pages are very similar to those for weighted papers (see Table 4.3). Publishing 27.60 weighted JBVpages, Fairlie is also the most prolific researcher publishing on black entrepreneurship based on this measuring metric. In second place are P. Köllinger, and Maria Minniti with 9.66 JBV-pages each. Then, Alejandro Portes and Min Zhou tied in fourth place with 7.86 weighted pages. The remaining authors published between .002 and 7.63 weighted pages. Fairlie’s contributions likewise lead the University of California, Santa Cruz to outpace all other affiliations publishing knowledge on black entrepreneurship in the major entrepreneurship outlets. Table 4.4 shows this university, with a total of 2.00 weighted papers published on black entrepreneurship, to be ranked first among all 21 affiliations. Babson College ranks second with 1.15 weighted papers, and the University of Alabama ranks third among the affiliations. Each of the remaining 18 affiliations published between .03 and .5 weighted papers on the subject. The rankings on affiliations by weighted paper counts are also very similar to the results on affiliations’ weighted paper rankings. Table 4.5 presents these results. Again, because of Fairlie’s contribution, the University of California, 73
Santa Cruz leads in first place with 27.60 weighted papers on black entrepreneurship. This university is trailed by the University of Alabama in second place with 10.46 weighted pages. Babson College ranks third with 10.17 weighted JBV-pages. The remaining 18 affiliations published between .003 and 9.66 weighted papers on the subject.
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Table 4.2: Weighted Number of Papers Rankings for 29 Authors Publishing Black Entrepreneurship Literature
Rank 1
Total Wtd Papers
1
2.000
2 tied
8
9 tied
16 tied
19 tied
23 tied
27 tied
Affiliation
Affln Country
Robert W. Fairlie
University of California, Santa Cruz
US
0.500
P. Köllinger
German Inst. for Econ. Rsrch
0.500
Marilyn L. Kourilsky
Kauffman Ctr. for Entrepr'l Ldrshp
US
0.500
Maria Minniti
Babson College
US
0.500
Alejandro Portes
Johns Hopkins University
US
0.500
William B. Waistad
University of Nebraska-Lincoln
US
0.500
Min Zhou
University of Calif., Los Angeles
US
0.300
Paul D. Reynolds
Babson College
US
0.250
Nancy M. Carter
University of St. Thomas
US
0.250
William B. Gartner
University of Southern Calif.
US
0.250
Patricia G. Greene
Babson College
US
0.250
Warren Martin
University of Alabama
US
0.250
Ruming Pan
University of Alabama
US
0.250
John Sandefur
Computer Builders Warehouse
US
0.250
Barbara A. Wech
University of Alabama
US
0.100
Laquita Blockson
University of Northern Iowa
US
0.100
Candida G. Brush
Babson College
US
0.100
Beth Crosa
Ohio State University
US
0.050
Craig S. Galbraith
University of NC, Wilmington
US
0.050
Curt Stiles
Calif. State Univ., Bakersfield
US
0.050
Sammis B. White
US
0.050
Nicholas Young
Univ. of Wisconsin–Milwaukee University of Chicago & College of Wooster: Ohio
0.033
Howard E. Aldrich
University of North Carolina
US
0.033
Lisa A. Keister
Ohio State University
US
0.033
Jeffrey Robinson
New York University
US
0.033
Sammie Robinson
Illinois Weslyan Univ., Blmgtn
US
0.025
Amy Gannon
Babson College
US
0.025
Daniel Monti
Babson College
US
0.025
Andrea Ryan
Babson College
US
First Name
75
Germany
US
Table 4.3: Weighted Number of JBV-pages Rankings for 29 Authors Publishing Black Entrepreneurship Literature
Rank 2
Total Atr Wtd JBV pages
1
27.60
2 tied
Affiliation
Affln Country
Robert W. Fairlie
University of California, Santa Cruz
US
9.66
P. Köllinger
German Inst. for Econ. Rsrch
2 tied
9.66
Maria Minniti
Babson College
US
4 tied
7.86
Alejandro Portes
Johns Hopkins University
US
4 tied
7.86
Min Zhou
University of Calif., Los Angeles
US
6 tied
7.63
Marilyn L. Kourilsky
Kauffman Ctr. for Entrepr'l Ldrshp
US
6 tied
7.63
William B. Waistad
University of Nebraska-Lincoln
US
8 tied
5.52
Paul D. Reynolds
Babson College
US
8 tied
5.52
Nancy M. Carter
University of St. Thomas
US
8 tied
5.52
William B. Gartner
University of Southern Calif.
US
8 tied
5.52
Patricia G. Greene
Babson College
US
12 tied
3.49
Warren Martin
University of Alabama
US
12 tied
3.49
Ruming Pan
University of Alabama
US
12 tied
3.49
John Sandefur
Computer Builders Warehouse
US
12 tied
3.49
Barbara A. Wech
US
16
0.05
Nicholas Young
University of Alabama University of Chicago & College of Wooster: Ohio
US
17 tied
0.03
Howard E. Aldrich
University of North Carolina
US
17 tied
0.03
Beth Crosa
Ohio State University
US
17 tied
0.03
Lisa A. Keister
Ohio State University
US
20 tied
0.00
Craig S. Galbraith
University of NC, Wilmington
US
20 tied
0.00
Curt Stiles
Calif. State Univ., Bakersfield
US
20 tied
0.00
Sammis B. White
Univ. of Wisconsin–Milwaukee
US
23 tied
0.00
Laquita Blockson
University of Northern Iowa
US
23 tied
0.00
Jeffrey Robinson
New York University
US
23 tied
0.00
Sammie Robinson
Illinois Weslyan Univ., Blmgtn
US
26 tied
0.00
Candida G. Brush
Babson College
US
26 tied
0.00
Amy Gannon
Babson College
US
26 tied
0.00
Daniel Monti
Babson College
US
26 tied
0.00
Andrea Ryan
Babson College
US
First Name
76
Germany
Table 4.4: Weighted Number of Papers Rankings for 21 Affiliations Publishing Black Entrepreneurship Literature
Rank 3
Total Wtd papers
1
2.00
University of California, Santa Cruz
US
2
2
2
1.15
Babson College
US
2.2
1
3
0.75
University of Alabama
US
1
3 tied
4 tied
0.50
German Inst. for Econ. Rsrch
Germany
1
3 tied
4 tied
0.50
Johns Hopkins University
US
1
3 tied
4 tied
0.50
Kauffman Ctr. for Entrepr'l Ldrshp
US
1
3 tied
4 tied
0.50
University of Calif., Los Angeles
US
1
3 tied
4 tied
0.50
University of Nebraska-Lincoln
US
1
3 tied
9 tied
0.25
Computer Builders Warehouse
US
0.1
11 tied
9 tied
0.25
University of Southern Calif.
US
1
3 tied
9 tied
0.25
University of St. Thomas
US
1
3 tied
12
0.07
Ohio State University
US
0.1
11 tied
13 tied
0.05
Calif. State Univ., Bakersfield
US
0.1
11 tied
13 tied
0.05
College of Wooster
US
0.1
11 tied
13 tied
0.05
University of Chicago
US
0.1
11 tied
13 tied
0.05
University of NC, Wilmington
US
0.1
11 tied
13 tied
0.05
Univ. of Wisconsin–Milwaukee
US
0.1
11 tied
18 tied
0.03
Illinois Weslyan Univ., Blmgtn
US
0.1
11 tied
18 tied
0.03
NYU-Stern School of Business
US
0.1
11 tied
18 tied
0.03
University of North Carolina
US
0.1
11 tied
18 tied
0.03
University of Northern Iowa
US
0.1
11 tied
Affiliation
77
Country
Total UnWtd papers
Rank
Table 4.5: Weighted Number of JBV-pages Rankings for 21 Affiliations Publishing Black Entrepreneurship Literature
Affln Country
Total UnWtd JBV pages
Rank
Rank 4
Total Wtd JBV pages
1
27.60
University of California, Santa Cruz
US
27.60
1
2
10.46
University of Alabama
US
13.95
10 tied
3
10.17
Babson College
US
19.48
4
4
9.66
German Inst. for Econ. Rsrch
Germany
19.32
5
5 tied
7.86
Johns Hopkins University
US
15.72
6 tied
5 tied
7.86
University of Calif., Los Angeles
US
15.72
6 tied
7 tied
7.63
Kauffman Ctr. for Entrepr'l Ldrshp
US
15.26
8 tied
7 tied
7.63
University of Nebraska-Lincoln
US
15.26
8 tied
9 tied
5.52
University of Southern Calif.
US
22.08
2 tied
9 tied
5.52
University of St. Thomas
US
22.08
2 tied
11
3.49
Computer Builders Warehouse
US
13.95
10 tied
12
0.06
Ohio State University
US
1.94
12
13 tied
0.05
College of Wooster
US
0.97
13 tied
13 tied
0.05
University of Chicago
US
0.97
13 tied
15
0.03
University of North Carolina
US
0.97
13 tied
16 tied
0.00
Calif. State University, Bakersfield
US
0.08
16 tied
16 tied
0.00
University of NC, Wilmington
US
0.08
16 tied
16 tied
0.00
Univ. of Wisconsin–Milwaukee
US
0.08
16 tied
19 tied
0.00
Illinois Weslyan Univ., Blmgtn
US
0.08
16 tied
19 tied
0.00
New York University
US
0.08
16 tied
19 tied
0.00
University of Northern Iowa
US
0.08
16 tied
Affiliation
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5.0 SURVEY OF THE ENTREPRENEURSHIP LITERATURE PUBLISHED BY HBCUs 5.1 Descriptive Results This section summarizes the descriptive results on the HBCU entrepreneurship literature contained in the major entrepreneurship literature from 1995 to 2006. It provides rankings on all HBCUs and HBCU authors that published any papers in the dataset on entrepreneurship. This section also highlights what types of research topics HBCUs are researching in the literature.
5.1.1 Proportion of HBCU publication A total of 24 papers are published in the major entrepreneurship outlets by HBCU authors over this study’s 12-year period. Since the broader number of all papers published in these major outlets equals approximately 21,000, the proportion of HBCU contribution to entrepreneurship amounts to roughly .11 percent. However, none of the black entrepreneurship papers discussed in Section 4.0 were written by HBCU scholars, so it would appear that the entrepreneurship scholarship that has been undertaken by HBCU researchers may not have focused on the issues surrounding black entrepreneurs. To this researcher’s knowledge, no prior studies have empirically verified just how under-represented HBCU scholarship remains in both the black entrepreneurship literature, and in the major entrepreneurship literature. The importance of this finding may similarly rest in its stimulating HBCU researchers
79
to develop new knowledge in these critical areas, and similarly in its stimulating publication gatekeepers to facilitate increasing in HBCU output in the literature. As this dissertation has earlier argued, if HBCU scholars do not provide research leadership in the major entrepreneurship outlets, then that literature may not accurately inform researchers and practitioners on some of the critical idiosyncrasies confronting black entrepreneurs and entrepreneurship. Nonetheless, this study does acknowledge that the question of whether or not HBCU scholars are fervently attempting to publish in the major entrepreneurship outlets remains an empirical question not examined in this study. To be sure, the fact that only 24 papers (or less than one half of one percent) of the dataset’s 5,909 papers were published by HBCUs, is not evidence of a lack of trying. Scholars at HBCUs are cognizant of issues that specifically relate to the black U.S. experience: issues that may drive the contradictory findings discussed concerning this group. In the absence of convincing arguments refuting that HBCU scholars are investigating these types of issues, we can reasonably assume that they are researching and submitting to major outlets, studies of black entrepreneurship. But, if such studies are not likely to be included in the major publication outlets3, as evidenced by only 13 papers (or one fifth of one percent) comprising the portion of these studies in the dataset’s 5,909 papers, then HBCU research would be significantly less likely to get published. In which case the low percentage of HBCU publication in the major entrepreneurship literature would 3
See Section 4.0 for an explanation on why black entrepreneurship studies are not likely to be included in the major entrepreneurship literature.
80
be explained. Another reason for such a low portion of HBCU studies may have to do with the few number of HBCUs that have business schools, that offer entrepreneurship programs/courses, and that have schools that are accredited with the Association to Advance Collegiate Schools of Business (AACSB). Many HBCUs have begun efforts to increase their offerings in business and/or entrepreneurship programs, and to increase their Carnegie Classification status. Only two HBCUs, Jackson State University and Morgan State University, offer Ph.D. programs in business. As these efforts continue, perhaps work such as the current study will join others’ to enact change in the proportion of knowledge that HBCU research provides to the literature, thereby leading to totally different findings. . 5.1.2 HBCU Authors and Affiliations The 24 papers published by HBCUs were written by a total of 26 authors who were associated with 10 affiliations (see Tables 5.1 through 5.3 for rank listings of the Top Authors and Affiliations). All ten of the HBCU affiliations are U.S. institutions. Nine of them are public institutions and one (Clark Atlanta University) is private.
5.1.3 Paper characteristics Three of the 26 authors wrote conceptual papers, and 16 wrote empirical
81
papers4. John O. Ogbor, Alan Miller, and Sharon Thach are the three authors who wrote conceptual papers. Robert P. Singh of Morgan State University is the only author who published both on entrepreneurship and opportunity recognition. He wrote “Opportunity Recognition: Examining How Search Formality and Search Processes Relate to the Reasons for Pursuing Entrepreneurship.” Because of Robert P. Singh, Morgan State University is the only HBCU that produced knowledge on both entrepreneurship and opportunity recognition. Also, only one author indicated that his study was funded. That paper, entitled, “For the Greater Good: Business Networks and Business Social Responsibility to Communities,” was written by Robert K. Perkins of the University of Arkansas at Pine Buff. He wrote the paper along with two coauthors whose affiliations were non-HBCUs.
5.1.4 Sole Authors versus Collaborators Five authors are the sole authors on journal articles. These five authors are Reginald M. Beal, Linda L. Carr, John O. Ogbor, Abu N. M. Wahid, and Anthony D. Wilbon of Morgan State University. Two other authors are sole authors on conference proceedings papers. These two authors are Ruthie G. Reynolds and William Lewis Randolph. The remaining authors wrote papers along with between one and five co-authors.
4
The five USASBE papers were unavailable through the publisher at the time of data collection. A limited amount of citation information was available on these five papers.
82
5.1.5 Most Prolific HBCU researchers (and HBCUs) Reginald M. Beal, Anthony D. Wilbon, Linda L. Carr, Abu N. M. Wahid, and John O. Obor are the most prolific HBCU researchers publishing in the major entrepreneurship publication outlets in terms of weighted papers. Table 5.1 displays the authors’ rankings. These five authors published 1.0 weighted
83
Table 5.1: Top Ranked HBCU Authors in Entrepreneurship Literature. Rank 1
1
6 7 9 10
Total Wtd Papers
Author
Affiliation
Rank
Total UnWtd* Papers
1.000
Reginald M. Beal
Florida A&M University
3
1.0
1.000
Anthony D. Wilbon
Morgan State University
3
1.0
1.000
Linda L. Carr
Tennessee State University
3
1.0
1.000
Abu N.M. Wahid
Tennessee State University
3
1.0
1.000
John O. Ogbor
Texas Southern University
3
1.0
0.608
Robert P. Singh
Morgan State University
1
1.3
0.500
Soo Hoon Lee
Morgan State University
3
1.0
0.500
Leyland M. Lucas
Morgan State University
3
1.0
0.483
John Masten
Tennessee State University
1
1.3
0.333
G. Bruce Hartmann
Tennessee State University
3
1.0
0.330
Robert K. Perkins
Univ. of Arkansas at Pine Bluff
3
1.0
0.333
Arief Safari
Tennessee State University
3
1.0
13
0.220
Tennessee State University
13
0.2
14
0.100
Ruthie G. Reynolds William Lewis Randolph
Norfolk State University
15
0.1
0.100
Ven Sriram
Morgan State University
13
0.2
0.050
Melinda D. Harris
Norfolk State University
15
0.1
0.050
Benson Kandoole
Tennessee State University
15
0.1
0.050
Alan Miller
Tennessee State University
15
0.1
0.050
Tennessee State University
15
0.1
0.050
Sharon Thach Denise-Margaret Thompson
Norfolk State University
15
0.1
0.033
Hilton Barret
Elizabeth City State Univ.
15
0.1
0.033
Micah E. S. Crump
Morgan State University
15
0.1
0.017
Robert Askew
Norfolk State University
15
0.1
0.017
Edward Irons
Clark Atlanta University
15
0.1
0.017
Thaddeus McEwen
North Carolina A&T State Univ.
15
0.1
16
21
23
0.017 Mary M. White Jackson State University 15 0.1 * This column shows unweighted sums that do not consider the numbers of co-authors. The summed scores do consider the weighted differences between journal articles and conference papers.
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Table 5.2: HBCU Weighted Papers on Entrepreneurship
1
2.753
Tennessee State University
Nashville
Tennessee
1
3.6
9
1
2 3
2.208
Morgan State University
Baltimore
Maryland
2
3.5
8
2
1.000
Texas Southern University, Houston
Houston
Texas
1
1
1.000
Florida A&M University
Tallahassee
Florida
1
1
5
0.330
University of Arkansas at Pine Bluff
Pine Bluff
Arkansas
1
1
6
0.167
Norfolk State University
Norfolk
Virginia
0.3
3
7
0.033
Elizabeth City State University
Elizabeth City
North Carolina
0.1
1
0.017
Clark Atlanta University
Atlanta
Georgia
0.1
1
0.017
Jackson State University
Jackson
Mississippi
0.1
1
85
Rank1
Total Wtd 1 Papers
8
Affiliation
City
State
Rank2
Total UnWtd* Papers
Total UnWtd† Papers
Rank3
3
6
7
4 tied
3
4 tied
0.017 North Carolina A&T State University Greensboro North Carolina 0.1 1 * This column shows unweighted sums that do not consider the numbers of co-authors. The summed scores do consider the weighted differences between journal articles and conference papers. † This column does not factor in any type of weighting.
Table 5.3: HBCU Weighted JBV-pages in Entrepreneurship
Rank1
Total Wtd JBVpgs
1
≥ 25.70
2 3 4
Affiliation
City
State
Total UnWtd JBVpgs
Rank2
≥ 44.83
2
86
Tennessee State University
Nashville
Tennessee
23.25
Texas Southern University, Houston
Houston
Texas
23.25
3
19.53
Florida A&M University
Tallahassee
Florida
19.53
4
11.00
Morgan State University
Baltimore
Maryland
51.83
1
5
6.02
University of Arkansas at Pine Bluff
Pine Bluff
Arkansas
18.24
5
6
≥ 0.12
Norfolk State University
Norfolk
≥ 0.28
7
7
0.03
Elizabeth City State University
Elizabeth City
Virginia North Carolina
0.89
6
≥ 0.02
Clark Atlanta University
Atlanta
Georgia
≥ 0.1
≥ 0.02
Jackson State University
Jackson
≥ 0.1
≥ 0.02
North Carolina A&T State University
Greensboro
Mississippi North Carolina
8 tied
≥ 0.1
8 tied
papers each over the 12-year period. Robert P. Singh of Morgan State University solely occupies the second ranking level with .608 weighted papers. Next are Soo Hoon Lee, and Leyland M. Lucas, both also of Morgan State University. These two researchers occupy the third level ranking with .500 weighted papers each. The remaining HBCU researchers published between 0.017 and 0.483 weighted papers in the dataset. As far as non-weighted paper contributions5 are concerned, Robert P. Singh of Morgan State University, and John Masten of Tennessee State University are both the most prolific HBCU researchers publishing in the major entrepreneurship outlets. As Table 5.1 also shows, both scholars published 1.3 papers each in the dataset. The actual number of papers written in the dataset by both of these authors is four. However, each published one journal article and three papers in proceedings. Therefore, their assigned non-weighted values are 1.3 each. Ten authors share the third place ranking based on publishing 1.0 non-weighted papers in the dataset. The remaining HBCU researchers published between 0.1 and 0.2 non-weighted papers in the dataset. Table 5.2 presents the results for HBCU university rankings based on weighted paper counts in entrepreneurship. Tennessee State University and Morgan State University dominate the top rankings for most prolific HBCUs. Tennessee State University published nearly 3.0 weighted papers. When all
5
Non-weighted in this sense refers to not considering numbers of co-authors. These statistics do however reflect weighted adjustments for proceedings papers versus journal articles as discussed in the methodology section.
87
weighting consideration are removed, this university published nine papers in the dataset. In close second place, Morgan State university published just over 2.0 weighted papers in the dataset. The number of these papers prior to any weighting consideration is eight.
Texas Southern University at Houston, and
Florida A&M University tie each other for third place. Each published 1.0 weighted papers in the dataset. The remaining HBCUs published between 0.017 and 0.033 weighted papers in the dataset. The rankings for HBCU affiliations based on weighted JBV-pages are displayed in Table 5.3. Tennessee State University leads in first place with at least6 25.70 weighted JBV-pages. In second place is Texas Southern University, Houston publishing 23.25 weighted pages. Florida A&M University is in third place with 19.53 weighted pages. The remaining HBCUs published between at least 0.02 and 11.00 weighted pages in the dataset. Table 5.3 also displays non-weighted JBV-page rankings for HBCU affiliations. Morgan State University leads in first place with 51.83 weighted pages. Tennessee State University closely trails in second place with at least 44.83 weighted papers. And, Texas Southern University, Houston ranks third with its 23.25 weighted pages. The remaining HBCUs published between at least 0.10 and 19.53 weighted papers in the dataset.
5.1.6 Representation among publication outlets
6
USASBE proceedings papers were all given a one-page value because the actual numbers of pages remained unavailable during the data collection stage. One page is the lowest number of pages of which a published paper consisted.
88
Nine of the 24 papers were published in seven different academic journals, and 15 were published in the three entrepreneurship conference proceedings. With three journal articles, the Journal of Small Business Management ranks first among publication outlets in terms of quantity of weighted papers published by HBCU researchers. Note that while UIC/AMA, USASBE, and Babson each published seven, six, and two papers respectively prior to weighting, once these papers are weighted, the outlets published only .7, .6, and .2 papers by HBCU authors (see Table 5.4).
5.2 What HBCUs are Publishing in Entrepreneurship (Paper Titles) Table 5.5 shows the 24 papers that HBCU authors published during the 12-year period. As the titles of these papers show, HBCU researchers have advanced knowledge on a variety of critical entrepreneurship topics. These include: business networks; social responsibility; types of entrepreneurs (e.g., homemakers, technology, women, and minority); entrepreneurship literature critiques; effects of industry on business venture; business management, success, and survival; strategy and entrepreneurship; opportunity recognition; international entrepreneurship, and HBCU challenges.
89
Table 5.4: Publication Outlet Productivity by HBCU Authors
Rank
Total UnWtd * Papers
Total UnWtd† Papers
Total Wtd Papers
Number of OpRec papers
Empirical or Conceptual
Funded No =0
1
3.00
3.00
3.00
0
3 empirical
0
1.00
1.00
0.33
0
1 empirical
Funded
1.00
1.00
1.00
0
1 empirical
0
1.00
1.00
0.50
0
1 empirical
0
Journal of Management Studies Journal of Entrepreneurship
1.00
1.00
1.00
0
1 empirical
0
1.00
1.00
1.00
0
2 empirical
0
Journal of High Tech Mngmt Rsrch
1.00
1.00
1.00
0
2 empirical
0
Journal/Proceeding Journal of Small Business Management Entrepreneurship and Regional Development Entrepreneurship Theory & Practice Journal of Business Venturing
2
90
University of Illinois Chicago AMA
8
0.70
7.00
0.40
0
6 emprcl & 1 cncptl
0
United States Assoc. for Small Bus. & Entrepreneurship
9
0.60
6.00
0.52
unknwn
unknwn
unknwn
Babson Frontiers of Entrepreneurship Research 10 0.20 2.00 1.25 1 2 empirical 0 * This column shows unweighted sums that do not consider the numbers of co-authors. The summed scores do consider the weighted differences between journal articles and conference papers. † This column does not factor in any type of weighting.
Table 5.5: What HBCUs are Publishing in Entrepreneurship (by Paper Titles)
Year
Article Title
# of Aflns
# of Atrs
2005
For The Greater Good: Business Networks And Business Social Responsibility To Communities. Not Just Domestic Engineers: An Exploratory Study Of Homemaker Entrepreneurs
2004
An Exploratory Study Of Technopreneurial Intentions: A Career Anchor Perspective.
2
2
2000
Mythicizing And Reification In Entrepreneurial Discourse: IdeologyCritique Of Entrepreneurial Studies
1
1
1995
Effects Of Industrial Merger On Productivity And Profitability: A Review
1
1
2002
Predicting Survival Of High-Technology Initial Public Offering Firms
1
1
2000
Competing Effectively: Environmental Scanning, Competitive Strategy, And Organizational Performance In Small Manufacturing Firms
1995
Small Business Strategic Planning And Technology Transfer: The Use Of Publicly Supported Technology Assistance Agencies
1
3
1997
Strategic determinants of executive compensation in small publicly traded firms
1
1
2006
OpRec
Emprcl
Funded
Y
1
Jrnl Total UnWtd* Papers
Jrnl Total UnWtd† Papers
Jrnl Total JBVpgs
ERD
1.00
1.00
18.24
ETP
1.00
1.00
13.08
JBV
1.00
1.00
22.00
JMS
1.00
1.00
23.25
JoE
1.00
1.00
9.94
JHTMR
1.00
1.00
12.00
JSBM
3.00
3.00
41.85
Journal /Pcdng
3
3
1
2
-
Y
-
Y
-
Cncptl
-
Y
-
Y
1
1
Y
-
Y
-
Y
Table 5.5: What HBCUs are Publishing in Entrepreneurship (by Paper Titles)
2004
Article Title Opportunity Recognition: Examining How Search Formality and Search Processes Relate to the Reasons for Pursuing Entrepreneurship
2001
Year
# of Aflns
# of Atrs
OpRec
Emprcl
...continued.
Funded
Journal /Pcdng
Jrnl Total UnWtd* Papers
Jrnl Total UnWtd† Papers
Jrnl Total JBVpgs
Babson
2.00
0.20
1.053
U I C / A M A
7.00
0.70
5.77
2
4
Perceptions of Entrepreneurial Opportunity: Minority and Women Entrepreneurs
1
2
2006
Blogs as marketing tools for entrepreneur: Trends, implications, and research directions
2
3
1997
Corporate Management of New Ventures: The Case of Real Estate Investment Trusts
2
2
2003
Recognizing Opportunities vs. Deciding to Become an Entrepreneur: A Test of Bhave’s Model
1995
Seizing the Opportunity and Consolidating the Gains: SMEs and Entrepreneurial Growth Through Exporting
1
2
2004
Success Factors for Entrepreneurial Organizations
2
3
1995
Using Business Associations to Increase Exports in a Newly Marketized Economy: Blending Classical Theory with Practice
2
2
1995
Vertical lntegration and Entrepreneurial Performance in a Fragmented Industry: An Empirical Analysis
2
2
1 -
Y Y Y Y
2
2
-
Y -
Cncpl
-
Y
-
-
Y
-
Y
Table 5.5: What HBCUs are Publishing in Entrepreneurship (by Paper Titles)
Year 2000
2000
Article Title A Process For Developing A National Policy On Micro Finance In Emerging Countries: The Case Of Malawi A Profile Of Women Microenterprise Programs
1997
# of Aflns
# of Atrs
2 1
2 1
1
1
1
1
6
6
1
2
Capitalizing Microenterprise Funds: The Virginia Enterprise Initiative 2000 2000
1999
Practitioner Partners Preparing Entrepreneurs For The 21st Century: Opportunities And Challenges Facing Historically Black Colleges And Universities The Capacity of the Small and Medium Enterprise Support System in Malawi to Support Small Business Expansion
OpRec
Emprcl
unknwn
...continued.
Funded
Journal /Pcdng
U S A S B E
Jrnl Total UnWtd* Papers
Jrnl Total UnWtd† Papers
Jrnl Total JBVpgs
6.00
0.60
11.66
Key for Table 5.5 * This column shows unweighted sums that do not consider the numbers of co-authors. The summed scores do consider the weighted differences between journal articles and conference papers. † This column does not factor in any type of weighting.
Key for Table 5.5 …continued Journal/Proceeding Acronym
Journal/Proceeding
Name
ASR
Administrative Science Quarterly
Babson
Babson College Entrepreneurship Research Conference Proceedings
ERD
Entrepreneurship and Regional Development
ETP
Entrepreneurship Theory & Practice
JBV
Journal of Business Venturing
JHTMR
Journal of High Tech Mgmt Research
JMS
Journal of Management Studies
JoE
Journal of Entrepreneurship
JSBM
Journal of Small Business Mgmt
SBE UIC/AMA
Journal of Small Business Economics Babson College Entrepreneurship Research Conference Proceedings United States Association for Small Business and Entrepreneurship Conference Proceedings
USASBE
6.0 SUMMARY: SURVEY OF THE BLACK ENTREPRENEURSHIP LITERATURE
6.1 Areas of the Black Entrepreneurship Literature This section of the study adds to the review of the literature in Section 2.0. It focuses on the findings that appeared in the major entrepreneurship outlets during the period of interest in this dissertation (1995-2006). As discussed in Section 4.0, there have only been 13 papers published on black entrepreneurship issues in the leading entrepreneurship and management outlets during the 12-year period. In this section, the findings from the 13 papers are discussed. The major black entrepreneurship findings are organized into five major areas: 1) rates of black entrepreneurship participation; 2) factors that facilitate or impede increases to black entrepreneurship rates; 3) characteristics of established business owner entrepreneurs; 4) outcomes derived by black entrepreneurs, and by their ventures; and 5) post-slavery era entrepreneurship. All findings organized within each of these five areas primarily relate to a specific theme that has been identified and indicated in each section. In all, 19 such themes are presented in this section. Together, these five areas and 19 themes constitute the structure and state of the current body of black entrepreneurship in the major entrepreneurship literature. Appendix A presents more detailed summaries of each of the 13 black entrepreneurship papers. The appended summaries provide readers with more extensive reference information. They highlight each study’s key findings that 95
relate primarily to black entrepreneurship. The summaries also provide basic information on each study’s respondents or data (when applicable), and basic citation information. Following the summaries, this section concludes with 24 exploratory research propositions for future research. The propositions are derived from the literature presented in this section, and that presented in Section 2.
6.2
Rates Of Black Entrepreneurship
6.2.1 Entrepreneurial Propensity Black youth are substantially more interested in pursuing entrepreneurship than white youth (Walstad & Kourilsky, 1998). Walstad and Kourilsky found that three-fourths of black youth are interested in pursuing entrepreneurship, compared to 63% of white youth. Blacks are significantly more likely than whites, Asians, and other minority groups in the United States to attempt to start a business (Köllinger & Minniti, 2006; Reynolds, Carter, Gartner, & Greene, 2004; Walstad & Kourilsky, 1998). That is, black Americans have the highest levels of propensity to start a business relative to these other groups (Köllinger & Minniti, 2006).
6.2.2 Perceptions: Alertness, Optimism, and Overconfidence Köllinger and Minniti (2006) found that part of the variance between black and white entrepreneurial propensity is explained by individual perceptions. Blacks exhibit higher alertness to business opportunities than whites, Asians, and 96
other minority groups in the U.S. (Köllinger & Minniti, 2006). Blacks are more optimistic than all other groups concerning their likelihood of new venture success: believing they possess sufficient skills, knowledge, and experience to start a business. Whites are more likely than all other groups to be concerned about the possibility of failure. Whereas blacks are less likely than all other groups to be concerned about the possibility of business failure (Köllinger & Minniti, 2006). Although black and white youth equally believe that their training in business and entrepreneurship is inadequate, and although both groups score equally low on basic knowledge regarding business and entrepreneurship, blacks are less critical of, and more optimistic in, their self-assessments on their knowledge and understanding in this area (Walstad & Kourilsky, 1998). A third of black youth rate their knowledge and understanding as either excellent or good, compared to only 13 percent of white youth. And, only 17 percent of black youth consider their knowledge and understanding as either poor or very poor, compared to nearly half of white youth.
6.2.3 Nascent Entrepreneurship Rate Blacks are more likely than whites to perceive business opportunities as “good” (Köllinger & Minniti, 2006). Yet, White and Reynolds (1997) found no differences among blacks and four other ethnic groups in Wisconsin in terms of their entrepreneurship participation in starting entrepreneurial ventures. However, subsequent studies (e.g., Köllinger & Minniti, 2006; Fairlie, 2004; and 97
Reynolds et al., 2004) show that when the researched population is extended throughout the entire U.S., that differences are observed. Reynolds et al. (2004) found that of approximately 10.1 million adults living in the U.S. who are attempting to start businesses, blacks account for 1.8 million, whites account for 7.7 million, and Hispanics account for 1.1 million.7 These researchers also found that black adults (ages 18 to 64 years) are 50 percent more likely than white adults to attempt to start a business. And, that black women are more likely than white and Hispanic women to attempt to start a business. Crosa, Aldrich, and Keister (2002) initially found that the effect of income and net worth showed that blacks and Hispanics are both less likely than whites to become nascent entrepreneurs. Yet, once human capital and education controls are factored in, blacks become only about 60 percent as likely as whites to become nascent entrepreneurs, and Hispanics become about 38 percent as likely as whites to become nascent entrepreneurs.
6.2.4 First-time Entrepreneurship Brush, Monti, Gannon, and Ryan (2006) found that black and Hispanic entrepreneurs are more likely to be running their first venture than any other venture. In contrast, the researchers found that whites are more likely to be running a business that constitutes their second through eighth startup. Only 40 percent of blacks are running a business other than their first startup, and 77 7
Reynolds et al. (2004) explain that the aggregate number of people who are attempting to start businesses (10.1 million) is less than the sum total number of people segmented by race because of “differences between official U.S. census data on Hispanics, which includes those who identify with other races.” p. 272
98
percent of whites are running a business other than their first startup (Brush et al., 2006).
6.2.5 Established Business Ownership Even though some research has found that blacks are significantly more likely than whites, Asians, and other minority groups in the United States to attempt to start a business, they are less likely than these other groups to succeed beyond the nascent entrepreneurship phase of venture development. That is, they are less likely to become established business owners (Köllinger & Minniti, 2006). Fairlie (2004) found that blacks are the least likely of all groups to own businesses (one third as likely as whites), followed by Hispanics (one half as likely as whites), and then Native Americans. Moreover, although the absolute number of black business owners increased (83 percent) from 1979 to 1998, with the exception of Hispanic business owners (193 percent), such increases do not provide evidence of an improving business ownership condition for blacks (Fairlie, 2004). Fairlie (2004) shows that similar to Asians, Hispanics, and Native Americans, the increases in business ownership for blacks primarily resulted from increases in their labor force participation, and not from increases in their propensity to choose self-employment.
That is, ownership increased consistent
with growth of the labor market, and not in overall percentage of black population. Black women were the exception in Fairlie’s study whereby their rapid increases in self-employment throughout the 1980s were not primarily due 99
to their expansion in the labor force. This finding potentially suggests an increase in entrepreneurial propensity among black women, at least throughout the 1980s. The rate of self-employment for black men is 5.1 percent, which equates to 39 percent of the rate for white men (13.1 percent). The self-employment rate of black women is 2.7 percent, equating to 36 percent of the rate for white women (7.5 percent). Fairlie (2004) writes that perhaps his most striking find is that the rankings of self-employment rates across the groups (blacks, whites, Asians, Hispanics, and Native Americans) have remained stable over the past two decades. Similarly, Fairlie and Meyers (2000) found that the black male to white male business ownership percentage ratio (one-to-three) has remained constant since 1910. The average age of any workforce changes as older and younger workers enter and exit the workforce. The average age also changes each year as existing workers become one year older. Fairlie (2004) examined increases in the average age of the U.S. workforce by race and gender, and how this aging impacted entrepreneurship founding rates. What he observed is that the average age of the workforce comprised of black men grew at a slower rate than that of white men. Fairlie (2004) also noted that given the probability increase in older people becoming self-employed, that the difference in the average age of the black versus white workforce contributed to increasing the black/white entrepreneurship gap. The researcher also observed that although the black male workforce aged slower than the white male workforce, that the black male 100
workforce was in fact increasing and therefore contributing to decreasing the black/white gap. Similarly, the researcher also observed that the average age of the black female workforce increased less rapidly than that of the white female workforce. In addition, black female workers were less likely to be married than white female workers. Fairlie (2004) noted that given the positive impact of being older and married on entrepreneurship, that these phenomena contributed to an increase in the black/white entrepreneurship gap (an increase of 1.468 percent to the gap). The increases in turn offset gains in business ownership that Fairlie (2004) observed by black men, created over the nearly 20 year period from 1979 to 1998. Finally, Fairlie (2004) points out that although Asians comprised a much smaller portion of the U.S. population than blacks, they owned nearly as many businesses as blacks. Fairlie (2004) believed that this finding supports that Asians have a higher propensity toward self-employment than blacks. In fact, whites and Asians have the highest rates of business ownership than all groups in Fairlie’s (2004) study.
6.2.6 Similar Circumstances in other Countries Köllinger and Minniti (2006) identify similar findings among United Kingdom respondents with respect to differences between white UK residents, and black UK residents of Caribbean and African descent. The black residents
101
are more likely to attempt to start a business than white residents, and less likely to be established business owners.
6.3
Factors Determining Black Entrepreneurship Rates
6.3.1 Personal Capital/Assets Increases in household income has a stronger positive effect on nascent entrepreneurship participation among black adults compared to white adults (Reynolds et al., 2004). Further, the effect of household income on entrepreneurship participation for black men and women is similar to that of Hispanic men and women. Among black, white, and Hispanic men and women, black men are the only group for which owning one’s place of dwelling (as in a home, condominium, or apartment) both positively and significantly relates to becoming a nascent entrepreneur (Reynolds et al., 2004). Causality is not clear. That is, whether dwelling ownership impacts nascent entrepreneurship participation, or if nascent entrepreneurship participation impacts home ownership (Reynolds et al., 2004) has not been determined. In contrast to Reynolds et al.’s (2004) findings above, Crosa et al. (2002) found that differences in financial assets of blacks and whites are not a major contributor to differences in the black/white entrepreneurship gap. In fact, they believed that the importance of financial assets may be overstated in the entrepreneurship literature. Crosa et al. (2002) found that any effect of income and net worth in spurring nascent entrepreneurship activity is nullified once 102
human capital, gender, and ethnicity are controlled. The researchers treated education, age, having self-employed parents, and current self-employment status as measures of human capital. These researchers explained that the reason why levels of financial assets do not determine whether or not people become entrepreneurs is that often people lacking ideal levels of startup capital continue in entrepreneurship in spite of their undercapitalization. These entrepreneurs, the researchers explain, rely on innovative measures to generate necessary startup capital, and overcome their undercapitalization. The researchers further found that age and education are strong predictors of who becomes a successful entrepreneur, instead of levels of financial assets. Therefore, Crosa and colleagues (2002) argue for the use of a contingency view of startup capital where the importance of levels of capital varies based on type of industry. They believe such an approach is more appropriate than generalizing the importance of financial capital to entrepreneurs in all fields or industries,
6.3.2 Restricted Access to Capital Even after Köllinger and Minniti (2006) controlled for both socio-economic variables and perceptual variables, they found that blacks were still more likely than whites to begin the process of starting a business. However, these researchers also found that perceptual variables and socio-economic variables among individuals do not explain much of the variance between black and white established entrepreneurs (i.e., owners of established businesses). They 103
believed this finding suggests that differences that are external to black and white established business owners are therefore responsible for suppressing business ownership rates among black entrepreneurs. Discriminatory and restricted access to capital are examples of external constraints. Both of these examples, found to constrain black entrepreneurs (see Section 2.0), would certainly explain much of the racial gap among established entrepreneurs that is not explained by perceptual and socio-economic variables.
6.3.3 Education: General and Entrepreneurship Education Crosa et al. (2002) found that education positively relates to people becoming nascent entrepreneurs, especially when they have a high school degree or less compared to any education level beyond high school graduation. Increases in education also relate to increases in business ownership (Fairlie, 2004). Blacks in the U.S. have been found to be less educated than white and Asian Americans (Köllinger & Minniti, 2006). Increased education has a stronger positive effect on nascent entrepreneurship participation among black adults than white adults (Reynolds et al., 2004). Reynolds et al. (2004) found that black men and women who report any graduate training are two to three times more likely than white men and women to attempt to start a business. Black (and Hispanic) men with graduate experience are at least twice as likely as white men with graduate experience to attempt to start a business. Increased levels of education among black men relative to white men contributed to a slight narrowing by 0.414 percent of the white/black self-employment rate gap from 104
1979-81 to 1996-98. That is, the gains in education among black men led to larger increases in self-employment rates than that of their white counterparts.
6.3.4 Employment and labor force Using 1980 Public Use Microdata Sample data from the U.S. Census on Cuban, Chinese, Japanese, and Korean men, and using random sample data on black and white men, Portes and Zhou (1996) showed that self-employed black men are similar to all others in that they have more years of work experience, and they work more hours than their salaried counterparts. Blacks are more likely than whites to be employed part-time, versus fulltime (Köllinger & Minniti, 2006). Blacks are similar to all other groups in the U.S. in that those involved in the U.S. labor force (e.g., those with full or part time jobs) are more likely to be nascent entrepreneurs than those who are not in the labor force (e.g., housewives, retirees, unemployed, and students) (Reynolds et al., 2004). Fairlie (2004) believes that his population-level findings support the idea that one method to increase the number of black and other minority-owned businesses is to implement broad policies to increase their labor force participation.
6.3.5 Age Crosa et al. (2002) examined nascent entrepreneurs and found a curvilinear relationship exists between age and nascent entrepreneurship, where after reaching a certain age, the relationship becomes negative. Thus, beyond certain ages, people are less likely to attempt to start a new business. Fairlie 105
(2004) examined entrepreneurs who owned established businesses (i.e., nonnascents) and found that age and business ownership are positively related. As owners of businesses get older, they need not necessarily change their business ownership status. Instead, they can remain an owner until their deaths, which would explain why a curvilinear relationship was not observed between age and business ownership. Fairlie (2004) also found that the average age of the black workforce (along with Asians, Hispanics, and Native American workforces) increased less rapidly than that of the white workforce, thereby reducing the selfemployment rates of blacks relative to whites.
6.3.6 Marital Status in Spurring Entrepreneurship Black women experienced a declining average probability of being married from 1979 to 1998 (Fairlie, 2004). Reynolds et al. (2004) analyzed nascent entrepreneurs and found that black women, when compared to white and Hispanic women, are the only group for which being married positively and significantly increases the likelihood of being a nascent entrepreneur. Fairlie (2004) analyzed entrepreneurs who had moved beyond the nascent stage and found that marital status and self-employment (business ownership) are positively related.
6.3.7 Entrepreneurial Networks A critical element of any entrepreneurial network is role models. The findings on black Americans and their likelihood of knowing entrepreneurial role 106
models are mixed. Walstad and Kourilsky (1998) found that black youth are less likely than white youth to know an entrepreneur. And among the black youth who do know an entrepreneur(s), the entrepreneur(s) is less likely to be a parent. Nearly ten years later, Köllinger and Minniti (2006) found that blacks are more likely than whites to know another entrepreneur. Some black women entrepreneurs are inspired by parents or extended family members who are/were entrepreneurs, or who are/were entrepreneurial in that they possess(ed) an entrepreneurial spirit or a spirit of economic self-determination (Robinson et al., 2005). The apparent contradiction here can be explained by the fact that Walstad and Kourilsky (1998) asked respondents if they personally knew a person who, at that time, ran a small business. Whereas, Köllinger and Minniti (2006) asked respondents if they knew someone personally who started a business in the past two years. Therefore, the former researchers’ finding more accurately reflects that black youth are less likely to know an established business owner. And, the latter researchers’ finding more accurately reflects that black Americans are more likely than white Americans to know another nascent entrepreneur. Young (1998) looked at a probability sample of 30 black owner-manager entrepreneurs whose firms were five years old or younger. While his investigation did not include comparisons with owner-manager entrepreneurs of other races, his findings do provide insight into the network structures of black entrepreneurs. He found that many black entrepreneurs do not configure their networks to include large and diverse affiliations. Instead, he found that they 107
assemble a small core of strong ties who aid them both in acquiring entrepreneurial resources, and in making important social and economic decisions. Young (1998) analyzed two separate dimensions of black entrepreneurs’ networks: 1) resource acquisition, and 2) social support. For resource acquisition, his findings include that black entrepreneurs compose their entrepreneurial resource networks mainly of other blacks (81.7%), other entrepreneurs (39.8%), friends (44.8%), especially close individuals (40.1%), and individuals they speak with on a daily basis (50.1%). The findings for social support include that black entrepreneurs similarly compose their networks mainly of other blacks (93.6%), other entrepreneurs (19.3%), friends (66.6%), emotionally close individuals (75.0%), and individuals they speak with daily (52.8%). Young also found that black entrepreneurs use their networks considerably to both receive information and acquisition assistance on: financial capital, location, information technology, and other entrepreneurial resources. Blacks use their social networks considerably for advice about major life changes, borrowing money, and improving their businesses. Young (1998) encourages black entrepreneurs to increase the sizes and diversity structures of their networks in order to increase the amount of beneficial information that becomes available to them. As a consequence, he suggests, black entrepreneurs will gain increased access to more highly resourced contacts who may provide social and resource acquisition support. Finally, Young (1998) emphasizes that “recognizing who these contacts are and the contribution each 108
can make to improving one’s success in the entrepreneurial arena” is key to effectively using one’s network.
6.3.8 Urban Contextual Impact Reynolds et al. (2004) show that among blacks, whites, and Hispanics, the positive relationship between urban residence and nascent entrepreneurship prevalence is strongest for black men and women8. While the relationship is also positive for white men and women, it is less so than for blacks. For Hispanic men and women, the relationship is reversed, whereby more nascent entrepreneurship occurs among those residing in the least urban contexts relative to the greatest. Reynolds et al. (2004) segmented their respondents into four groups of equal size quartiles. The quartiles were computed according to what the researchers referred to as “urbanness” (p. 279). In the lowest quartile, white men and white women had nascent entrepreneurship prevalence rates of 6.1 percent and 3.2 percent, respectively. In the highest quartile, these rates increased to 8.5 percent and 4.8 percent. In contrast, in the lowest quartile, black men and black women had nascent entrepreneurship prevalence rates of 9.5 percent and 4.5. percent, respectively. But, in the highest quartile, the numbers increased much higher to 12.4 percent and 9.1 percent. The increase for white men and women equals 2.4 percent for white men, and 1.6 percent for white women. For
8
Reynolds et al. (2004) do not discuss this statement as one of their findings. However, their Table 10 indexes in the “Above average quartile” and “Highest quartile” substantiate the statement.
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black men, the increase is 2.9 percent, and for black women the increase is 4.6 percent.
6.4
Characteristics of Established Black Business Businesses owned by black Americans are significantly smaller than those
owned by white Americans (Martin, Welch, Sandefur, & Pan, 2006). Yet, the various types of businesses that blacks exploit are statistically similar to those of whites (Köllinger & Minniti, 2006). Black women entrepreneurs more often market their products to fellow members of their racial/ethnic groups (Brush et al., 2006) compared to non-members. Black women entrepreneurs strongly believe that their circumstance as business owners was prompted by their heeding to a higher, spiritual calling (Robinson et al., 2005). Hence, the final measure of business success for these women is a venture’s ability to manifest “God’s” purpose for the business’ existence (Robinson et al., 2005).
6.4.1 Double-Minority Challenge Black women entrepreneurs perceive themselves being confronted by a double-minority challenge in that they are both black and female (Robinson, Blockson, & Robinson, 2005). As a result, during times that their credibility is threatened, their social identity is forced to fluctuate as to which minority status comes first. The fluctuation varies based on the context in which they find themselves. Robinson et al. (2005) found that many of these women chose not to compete for government and set-aside contracts in order to avoid negative 110
stigmatizations of inferiority and neediness that they believe are highly associated with labels of “minority-owned” or “woman-owned” enterprises.
6.4.2 Community Involvement/Support Black youth are more likely than white youth to believe that successful entrepreneurs and business people should give something back to the community beyond simply providing jobs (Walstad & Kourilsky, 1998). This finding appears to carry over to actual entrepreneurs. Black and Hispanic entrepreneurs more actively participate in community events than white entrepreneurs, and are more deeply involved with their ethnic communities (Brush et al., 2006). Black women entrepreneurs express as a strong measure of business success the ability to fulfill a responsibility to their local black community in the form of employment and economic support (Robinson et al., 2005). In fact, some expend effort to hire a significant number of high school dropouts, former felons, and public assistance recipients in order to provide opportunities for improvement among their at-risk community members. In addition, others hire local community members as a means to influence and mentor junior members toward optimal levels of professional and economic attainment.
6.4.3 Affinity Toward Business Training There have been changing perceptions of entrepreneurship training among blacks. Black youth believe more strongly than white youth that teaching 111
entrepreneurship in U.S. schools is vital to successful entrepreneurship (Walstad & Kourilsky, 1998). Martin, Welch, Sandefur, and Pan (2006) expanded on Hollingsworth and Hand’s (1976) research that found that black business people ranked lowest compared to whites and Cubans in perceiving a need for entrepreneurship training. Nearly two decades later, Martin et al. (2006) surveyed 421 black business owners, and 369 white business owners from one U.S. state and compared their responses on attitudes toward 23 areas of business training. These researchers found that the attitudes of black business owners towards training have become substantially more positive over the past twenty years. Using a seven-point scale with 7 representing the greatest importance, black business owners rated the importance of training in all 23 areas as significantly more important (at the .001 level) than whites. Both groups also ranked the 23 areas from most important to least important. For the most part, blacks and whites ranked the areas similarly. Notable differences include blacks assigning accounts receivable management a lower ranking of 9, compared to whites who assigned this training a higher ranking of 5. Black business owners also ranked training in: loan application, and managing technology lower than white business owners. Blacks ranked training in: strategic planning, obtaining business licenses, advertising, and government procurement higher than whites. When Martin et al. (2006) paired their sample to control for business age, type, size (number of full-time employees), and owner/respondent age, the sample size reduced from 790 to 298 respondents, with 149 black respondents, 112
and 149 white respondents. Again, both groups ranked the importance of each of the 23 areas of training similarly. Notable differences include blacks assigning a higher ranking of 4 to strategic planning than whites, who assigned this area a ranking of 10. Blacks assigned loan application the second to the least important rank (22), whereas whites assigned loan application a much higher ranking of 12. Blacks repeated the assigning of accounts receivable management a much lower ranking (10) than whites (4). And, blacks also assigned much lower rankings to sales (11 versus 6) and managing technology (20 versus 14) than whites.
6.5
Venture/Business Outcomes
6.5.1 Entrepreneurial earnings The self-employed earn more than their salaried counterparts (Portes & Zhou, 1996). However, black men are unique relative to Cuban, Chinese, Japanese, Korean, and white men in that they are the only men whose gains are not significant. Black men are also unique in that less than half of those whose earnings make them positive outliers are self-employed. For the other groups, more than half of the men who are positive outliers in terms of earnings are selfemployed. Fairlie’s (2005) findings show that overall men from disadvantaged families earn more through self-employment than their waged/salaried male counterparts, while women from disadvantaged families earn less through selfemployment than their waged/salaried female counterparts. Fairlie’s (2005) 113
regression results show separate earnings regression estimates, controlled for current earnings status, age, race, education, and other demographic characteristics. Although the results that are specific to blacks are not discussed in Fairlie’s (2005) article, they show that black men and women, both selfemployed and non-self-employed, earn less than white and Hispanic men and women.
6.5.2 Measures of Business/Venture Success Robinson et al.’s (2005) sample did not include women who were nonblack. Nonetheless, the researchers found that black women entrepreneurs do not measure business success merely in economic or financial terms. Instead, they believe a venture should provide two or more of the following as measures of business success: wealth for families; increased time to spend with family; ability to give back to community; ability to meet specific customer needs; and ability to fulfill a personal or spiritual calling. Some black women entrepreneurs view as a measure of business success an ability to maintain the same types of entrepreneurial traditions that they experienced in their families. The average age of Robinson et al.’s (2005) sample was 49, with half of the respondents being mothers. The researchers explain how many of these women managed conflicting demands of family and business. In response to the oft-times conflicting obligations, a large number of the AAWEs [African American Women Entrepreneurs] parlayed their professional 114
experiences and resources in a manner that enabled them to conduct business on their terms while continuing to meet their family’s needs. (p. 13) These women identified as another measure of business success, the ability to manage these conflicting demands. Nearly half of the black women who are established business owners want to grow their businesses into a larger venture, which these women identify as a measure of business success. The remainder prefers to maintain their current size: the ability of which they likewise view as a measure of business success. The majority of these women identify as key, their ventures not compromising their founding values.
6.5.3 Entrepreneurship as a Better Means Toward Ends In Brush et al.’s (2006) sample, all of the black entrepreneurs believed that their professional goals are best met through business ownership as opposed to employment through working for others. In comparison, only 69 percent of white entrepreneurs believe such to be the case. Black women business owners additionally find that entrepreneurship enables them to fulfill a personal calling, and to serve their local and racial communities (Robinson et al., 2005). Black youth more strongly than white youth believe that entrepreneurship allows people to: be their own boss, build something for family, earn significant money, use one’s skills and abilities, and overcome challenges. However, black
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youth believe that non-monetary reasons for starting one’s business are equally as important as monetary reasons (Walstad & Kourilsky, 1998). 6.6 Post-Slavery Era Entrepreneurship One of the outcomes of post-slavery freedom in the U.S. was an increase in black entrepreneurship. Galbraith and Stiles (1999) analyzed the body of work known as the “Slave Narratives” where interviews of an aging population of exslaves are narrated, documenting their memories of both their slave and postslave lives. They found that many slaves acquired critical artisan and productive skills that, once freed, few attempted to exploit entrepreneurially. Instead, the researchers found that the majority of these freed and skilled slaves entered into sharecropping, which the researchers refer to as small-scale, capital-deprived, joint ventures. Finally, the researchers found that a few of the freed slaves attempted supplementary entrepreneurial activity, or primary income entrepreneurship in artisan-based fields such as blacksmithing, or in agricultural fields such as small plot farming. The target market for nearly all of these ventures was the freed slaves’ more highly capitalized venture partners, the landowners.
6.7 Concluding Remarks The findings presented in this section comprise the set of findings on black entrepreneurship that currently exist within the major entrepreneurship literature. Hence, this section is a review of the current body of knowledge available on black entrepreneurship in the major entrepreneurship literature. The 13 papers 116
provide a glimpse of the entrepreneurship environment within which black entrepreneurs operate. The body of knowledge owes its existence to the 29 authors who provided the knowledge. Yet, 13 papers is hardly enough to establish a meaningful theoretical foundation for black entrepreneurship. One important outcome that may stem from this study’s empirical validation of just how scant the black entrepreneurship literature remains is spurred interest in developing this body of knowledge. The state of the black entrepreneurship literature provides enormous opportunities for research investigations. It also provides enormous opportunities to researchers wishing to establish themselves in an exploratory research frontier that offers promise to themselves, to academia, and to practitioners. To aid in such investigation, the following are suggested for future research examination. They are derived from the findings in this section, as well as those presented in Section 2.0, Literature Review.
Suggested Exploratory Research Propositions 1. Proposition 1: Blacks are more likely to recognize opportunities of lower lucrative value than those recognized by whites. 2. Proposition 2: Black entrepreneurs are less likely than other groups to secure VC funding for their ventures. 3. Proposition 3a: Black entrepreneurs are less likely than other groups to receive VC funding because their opportunities are considered less lucrative. 4. Proposition 3b: Black entrepreneurs are less likely than other groups to receive VC funding because there are fewer numbers of black VCs.
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5. Proposition 3c: Black entrepreneurs are less likely to be familiar with VC financing processes than other groups. 6. Proposition 3d: Black entrepreneurs are less likely than other groups to receive VC funding, given their lower knowledge of VC processes,. 7. Proposition 4: Black entrepreneurs will report lower levels of trust than white entrepreneurs. 8. Proposition 5: Blacks are more likely to be solo entrepreneurs than network entrepreneurs. 9. Proposition 6a: The relationship between black population density in a region and retail scarcity within that region is positive. 10. Proposition 6b: The relationship between black population density in a region and the proportion of blacks exploiting opportunities within that region is positive. 11. Proposition 6c: The relationship between retail scarcity in a region and the proportion of blacks exploiting opportunities within that region is positive. 12. Proposition 7: When factoring in informal economy entrepreneurship, there is no difference in the rates of serial entrepreneurship between black and white entrepreneurs. 13. Proposition 8a: The relationship between black population density in a region and the proportion of blacks within that region exploiting opportunities in the formal economy is negative. 14. Proposition 8b: The relationship between black population density in a region and the proportion of blacks within that region exploiting opportunities in the informal economy is positive. 15. Proposition 9a: The relationship between retail scarcity in a region and the proportion of blacks within that region exploiting opportunities in the formal economy is negative. 16. Proposition 9b: The relationship between retail scarcity in a region and the proportion of blacks within that region exploiting opportunities in the informal economy is positive. 17. Proposition 10a: The relationship between black population density in a region and black distrust of others within that region is positive. 118
18. Proposition 10b: The relationship between black distrust of others in a region and the proportion of blacks within that region trading in the informal economy is positive. 19. Proposition 11a: The relationship between retail scarcity in a region and blacks within that region perceiving the existence of marketplace corruption is positive. 20. Proposition 11b: The relationship between blacks in a region perceiving the existence of marketplace corruption and the proportion of blacks within that region trading in the formal economy is negative. 21. Proposition 11c: The relationship between blacks in a region perceiving the existence of marketplace corruption and the proportion of blacks within that region trading in the informal economy is positive. 22. Proposition 12a: The relationship between population density in a region and disparity of perceptions of firm performance between black and white entrepreneurs within that region is positive. 23. Proposition 12b: The relationship between retail scarcity in a region and disparity of perceptions of firm performance between black and white entrepreneurs within that region is positive. 24. Proposition 13: The relationship between retail scarcity, and disparity of trade processes between black and white entrepreneurs is positive.
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7.0 RANKINGS OF TOP ENTREPRENEURSHIP RESEARCHERS AND AFFILIATIONS
7.1 Introduction The purpose of this section is to present rank listings of the most prolific entrepreneurship researchers, and of the most prolific institutional affiliations of these researchers. In doing so, this section extends Shane’s (1997) work which ordered the impact of individuals and institutions on the field of entrepreneurship. The rankings of this study are ordered by quantitative output during the 12-year investigative period, 1995 - 2006. Shane (1997) explains the importance of this type of inquiry: First, the growing interest of the popular media in evaluating and ranking the entrepreneurship programs of different business schools creates a need for quantitative measures of program quality. Rankings of entrepreneurship programs are presently made without any consideration of the scholarly contribution of those programs. Yet these rankings have an effect on the degree to which students, faculty and funding agencies favor institutions (Morrison & Inpen, 1991). (p. 83) This section presents rankings that are based solely on scholarly contribution. Scholarly contribution is measured by number of articles and/or papers, and by number of pages published in the major entrepreneurship literature. The lists in this section thereby provide supplementary rankings based on information that is not contained in some of the existing rankings for entrepreneurship programs (e.g., Business Week, US News & World Report, and Entrepreneur Magazine). Without exception, these programs provide rankings 120
on entrepreneurship programs based on “variables other than scholarly research in their evaluation of program quality” (Shane, 1997, p. 92).
7.2 Overlap of “Top” Entrepreneurship Programs A total of 37 universities comprise Entrepreneur Magazine's 5th Annual Top 50 Entrepreneurial Colleges for 2007 (undergraduate and graduate programs combined). The universities are published on two separate lists: one for top undergraduate programs; and one for top graduate programs. The reason why the number of universities that comprise this list is 37, and not 50, is because 13 universities are ranked on both lists (see Table 7.1). Of these 37 top entrepreneurship programs, only five make the top lists based on scholarly contribution as measured and presented in this section. The five universities are Babson College, Indiana University-Bloomington, Ohio State University, University of Colorado-Boulder, and University of Maryland (see shaded universities in Table 7.1). Once the top affiliations lists are divided into U.S. versus Non-U.S. categories, two additional universities out of the 37 universities are added to this study’s list. These two universities are Baylor University, and University of California at Los Angeles. Therefore, only seven of the 37 universities listed as top entrepreneurial colleges for 2007 by Entrepreneur Magazine have published a sufficient number of papers in the major entrepreneurship outlets to achieve top affiliation status in this study.
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Table 7.1: Entrepreneur Magazine's 5th Annual Top 50 Entrepreneurial Colleges for 2007 Top 25 Undergraduate Colleges Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Babson College University of Houston Drexel University The University of Arizona University of Dayton Chapman University DePaul University Temple University University of North Dakota Loyola Marymount University Wichita State University Syracuse University University of Notre Dame University of Maryland University of Oklahoma University of Illinois, Urb.-Chmpgn Xavier University The University of Alabama University of Southern California Ball State University The University of Iowa Brigham Young University Baylor University Northeastern University The Ohio State University
Top 25 Graduate Colleges Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
University of Southern California Babson College The University of Arizona University of North Carolina, Chapel Hill DePaul University University of California, Los Angeles Drexel University Chapman University University of South Florida University of Illinois at Chicago Loyola Marymount University Temple University Monterey Institute of International Studies University of Colorado, Boulder Tulane University Syracuse University Indiana University, Bloomington University of Maryland San Diego State University University of Washington University of Illinois, Urbana-Champaign Rice University University of California, Riverside Northwestern University University of Notre Dame
http://www.entrepreneur.com/topcolleges/index.html
7.3 Most Prolific Authors (1995 – 2006) The rankings lists in this section are ordered by weighted paper counts (to control for papers with multiple coauthors and affiliations), and by weighted JBVequivalent pages. Each table also displays rankings on the far right that are based on non-weighted (referred to as “unweighted”) paper counts or JBV-
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equivalent page counts. Tables 7.2 and 7.3 show rankings of the top 25 authors. Appendix B shows extended lists of the top 100 rankings for authors. Scott A. Shane is the most prolific researcher among those publishing in the major entrepreneurship outlets during the 12-year period investigated in this study. He published a total of 16.97 weighted papers throughout the dataset. These 16.97 weighted papers amount to 31 actual papers that he either individually authored, or coauthored. Since six of these papers are conference proceedings, and the remaining 25 papers are journal articles, his total number of unweighted papers (unweighted by number of coauthors) is 25.6. Dean A. Shepherd and Shakar A. Zahra are second and third ranked authors in terms of weighted papers because they published 14.25 and 12.80 total weighted papers, respectively. Shane also published the highest number of weighted pages (378.90 JBVequivalent pages) during this study’s investigation period in the major entrepreneurship outlets. The number of pages that he published, not taking into account numbers of coauthors, is 566.81 JBV-equivalent pages. This number does reflect conference versus journal weightings. Zahra and Paul Westhead are second and third ranked in terms of numbers of weighted pages published with 308.87 and 274.04 weighted JBV-equivalent pages, respectively.
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Table 7.2: Rankings of Top 25 Authors by Total Weighted Papers
Rank
Total Wtd Papers
1
16.97
2 3 4
14.25 12.80 11.42
5
10.68
Scott A. Shane Dean A. Shepherd Shakar A. Zahra Paul Westhead James J. Chrisman
6
9.88
Mike Wright
7 8
8.58 8.50
David B. Audretsch James O. Fiet
Univ. of Nottingham Max Planck Institute of Economics & Indiana University Univ. of Louisville
9
8.00
Timothy Bates
Wayne State Univ.
US
8.0
48 tied
10
7.75
Peter J. Rosa
Univ. of Edinburgh
UK
14.6
11
11
7.70
Mark S. Freel
Canada
8.2
46
12
7.65
Australia
16.6
10
13
7.33
Per Davidson Howard E. Van Auken
Univ. of Ottawa Queensland Univ. of Technology Iowa State Univ.
US
7.6
56
14
7.00
CASS Bus. School
UK
8.0
48 tied
15
6.81
US
17.0
8
16
6.75
Australia
8.0
48 tied
17
6.71
Finland
13.7
15
18
6.48
13.3
17
6.38
Babson College Univ. of Illinois at Urbana-Champaign
US
19
US
7.5
57 tied
20
6.33
Erkko Autio Andrew L. Zacharakis Steven C. Michael Harry J. Sapienza
Univ. of Oklahoma Flinders Univ. of South Australia Helsinki Univ. of Technology
US
18.1
7
21 22
5.97 5.94
Robert A. Baron Colin M. Mason
Univ. of Minnesota Rensselaer Polytechnic Institute Univ. of Strathclyde
US Scotland
9.7 12.8
31 19
23
5.93
Univ. of Sussex
UK
9.3
36 tied
25 tied
5.89
Marc Cowling William B. Gartner
US
14.3
13
25 tied
5.89
Sue Birley
Clemson Univ. Imperial College of Sci. Tech. & Med.
UK
10.4
26
Author
Robert C. Cressy Lowell W. Busenitz Richard G. P. McMahon
Country
Total UnWtd Papers
UnWtd Papers Rank
US
25.6
4
Indiana University Univ. of Minnesota Univ. of Nottingham Mississippi State Univ.
US US UK
28.6 27.4 25.4
2 3 5
US
22.5
6
UK
32.3
1
Germany US US
13.2 14.4
18 12
Affiliation Case Western Reserve Univ.
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Table 7.3: Rankings of Top 25 Authors by Total JBVpages
Rank
Total Wtd JBV pages
Author
1
378.90
Scott A. Shane
2 3
308.87 274.04
4 5
236.09 205.67
6 7 8
177.03 155.56 147.05
Shakar A. Zahra Paul Westhead Dean A. Shepherd Mike Wright James J. Chrisman Peter J. Rosa James O. Fiet
9
135.26
10 11
134.26 126.39
12
113.95
Per Davidson Harry J. Sapienza Mark S. Freel Richard G. P. McMahon
13
112.21
David B. Audretsch
14
111.14
Benson Honig
15 16
111.11 109.23
17
107.73
18
107.20
19 20
105.79 104.97
21
102.66
Sue Birley Timothy Bates Howard E. Van Auken William B. Gartner Andrew L. Zacharakis Justin Tan Lowell W. Busenitz
22
98.91
Robert A. Baron
23
97.64
24
93.76
Erkko Autio Candida G. Brush
25
93.54
Lloyd P. Steier
Country
Total UnWtd JBV pages
UnWtd JBVpgs Rank
US
566.81
4
Univ. of Minnesota Univ. of Nottingham
US UK
649.45 585.53
2 3
Indiana Univ. Univ. of Nottingham Mississippi State Univ. Univ. of Edinburgh Univ. of Louisville Queensland Univ. of Technology
US UK
488.78 683.36
5 1
US UK US
460.14 287.10 227.40
6 11 19
Australia
330.68
9
US Canada
389.69 133.36
7 54
Australia
136.45
52
250.34
14
Canada
191.28
27
UK US
223.72 109.23
20 72
Iowa State Univ.
US
117.89
63
Clemson Univ.
US
322.02
10
Babson College York Univ. University of Oklahoma Rensselaer Polytechnic Institute Helsinki University of Technology
US Canada
227.96 137.97
18 49
US
266.35
12
US
168.37
38
Finland
230.80
17
Boston University University of Alberta
US
253.11
13
Canada
169.40
36
Affiliation Case Western Reserve Univ.
Univ. of Minnesota Univ. of Ottawa Flinders Univ. of South Australia Max Planck Institute of Economics & Indiana University Wilfrid Laurier University Imperial College of Sci. Tech. & Med. Wayne State Univ.
125
Germany US
7.4 Most prolific affiliations (1995 – 2006) Similar to the rankings of authors in 7.3, tables 7.4 and 7.5 show rankings of the top 25 affiliations irrespective of country (referred to as “Global” in the tables). Tables 7.6 and 7.7 show rankings of the top 25 U.S. affiliations only, and Tables 7.8 and 7.9 show rankings of the top 25 affiliations that are housed outside of the United States. Appendix C shows extended lists of the top 100 rankings for affiliations. Tables 7.4 and 7.5 show that Harvard University is the most prolific affiliation in terms of weighted papers among institutions whose researchers published in the major entrepreneurship outlets during the 12-year period investigated in this study. Harvard University researchers published a total of 43.711 weighted papers throughout the dataset. These 43.711 weighted papers amount to 76 actual papers that Harvard University Researchers either individually authored, or coauthored. Harvard University’s total number of unweighted papers (unweighted by number of coauthors) is 55.3. University of Nottingham and University of Warwick, both in the United Kingdom, are ranked second and third among affiliations in terms of weighted papers because their researchers published 34.830 and 29.930 total weighted papers, respectively. In terms of weighted JBV-equivalent pages, the University of Nottingham is the most prolific affiliation. The University of Nottingham published the highest number of weighted pages (680.47 JBV-equivalent pages) during this study’s investigation period in the major entrepreneurship outlets. The number of pages this affiliation published that do not weight for numbers of coauthors is 1,021.99 126
JBV-equivalent pages. This number does reflect conference versus journal weightings. Georgia State University and Harvard University are ranked second and third in terms of numbers of weighted pages published with 468.75 and 461.17 weighted JBV-equivalent pages, respectively.
Table 7.4: Rankings of Top 25 Affiliations by Total Weighted Papers
Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Total Wtd Papers 43.711 34.830 29.930 22.500 22.109 22.010 21.265 20.625 19.175 18.977 17.452 17.338 16.267 15.753 15.726 15.359
17 18 19 20 21 22 23 24 25
15.282 15.199 14.667 14.257 14.214 14.002 13.992 13.668 13.320
Affiliation Harvard University University of Nottingham University of Warwick Renssalaer Polytechnic Institute Georgia State University Indian Institute of Management University of Colorado at Boulder Babson College Jönköping University Indiana University, Bloomington Erasmus University University of Maryland Case Western Reserve University Boston University University of Calgary National University of Singapore
Country US UK UK US US India US US Sweden US Netherlands US US US Canada Singapore
Total UnWtd Papers 55.3 55.2 45.5 42.5 44.8 21.1 49.5 47.2 31.0 34.6 32.7 28.1 35.9 25.8 22.0 20.6
University of Minnesota, Minneapolis University of Pennsylvania Manchester Metropolitan University Stockholm University University of Alberta Ohio State University Georgia Institute of Technology University of Amsterdam Iowa State University
US US UK Sweden Canada US US Netherlands US
28.6 25.5 18.4 26.6 22.7 27.1 27.9 19.3 18.9
127
UnWtd Papers Rank 1 2 5 7 6 21 3 4 11 9 10 13 8 17 20 22 12 18 25 16 19 15 14 23 24
Table 7.5: Rankings Top 25 Affiliations by Total Weighted JBVpages
Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Total Affln Wtd JBVpgs 680.47 468.75 461.17 456.09 444.92 393.85 377.52 355.01 348.30 335.52 318.00 313.01
305.39 301.08 298.41 291.09 288.79 282.69 281.89 278.78 274.84 264.75 243.17 202.36 164.50
Affiliation University of Nottingham University of Warwick Georgia State University Harvard University Renssalaer Polytechnic Institute University of Colorado at Boulder Indiana University, Bloomington University of Maryland Jönköping University Case Western Reserve University Babson College University of Pennsylvania University of Minnesota, Minn. Erasmus University Boston University Manchester Metropolitan University National University of Singapore University of Alberta Indian Institute of Management Georgia Institute of Technology University of Calgary Ohio State University Stockholm University Iowa State University University of Amsterdam
Country UK UK US US US US US US Sweden US US US US Netherlands US UK Singapore Canada India US Canada US Sweden US Netherlands
Total UnWtd JBVpgs 1021.99 726.75 883.71 615.52 707.37 852.10 694.83 553.64 562.91 677.03 318.00 492.87
UnWtd JBVpgs Rank 1 4 2 8 5 3 6 10 9 7 22 14
534.43
12 11 15 21 20 18 23 13 19 16 17 24 25
550.89 477.03 364.11 375.11 449.79 315.15 511.43 429.50 474.47 450.52 268.72 237.30
7.5 Top Affiliations by U.S. and by Non-U.S. Status Tables 7.6 and 7.7 show the 25 most prolific U.S. affiliations whose researchers published in the major entrepreneurship outlets during the 12-year investigation period. In terms of weighted papers published by these U.S. affiliations, Harvard University is ranked first, followed by Renssalaer Polytechnic Institute, and then Georgia State University. In terms of weighted JBV-equivalent pages published by U.S. affiliations, Georgia State University is ranked first, 128
followed by Harvard University, and then Renssalaer Polytechnic Institute. For non-U.S. affiliations, in terms of weighted papers published, University of Nottingham is ranked first, followed by University of Warwick, and then Indian Institute of Management (in India). In terms of weighted JBV-equivalent pages published by non-U.S. affiliations, University of Nottingham is ranked first, followed by University of Warwick, and then Jönköping University (in Sweden). Table 7.6: Rankings of Top 25 US Affiliations by Total Weighted Papers
US Ranking 1 2 3
Total Wtd Papers 43.711 22.500 22.109
4 5 6 7 8 9
21.265 20.625 18.977 17.338 16.267 15.753
10 11 12 13 14 15 16 17 18 19
15.282 15.199 14.002 13.992 13.320 11.835 10.888 10.628 10.584 10.347
20 21 22
10.043 10.017 9.513
23 24 25
9.305 9.238 9.187
Affiliation Harvard University Renssalaer Polytechnic Institute Georgia State University University of Colorado at Boulder Babson College Indiana University, Bloomington University of Maryland Case Western Reserve Univ. Boston University
Cntry US US US
Global Wtd Papers Rank 1 4 5
US US US US US US
7 8 10 12 13 14
49.5 47.2 34.6 28.1 35.9 25.8
2 3 7 9 6 12
University of Minnesota, Minn. University of Pennsylvania Ohio State University Georgia Institute of Technology Iowa State University Baylor University University of South Carolina Stanford University University of Central Florida University of Calif. Las Angeles University of Michigan, Ann Arbor Utah Slate University Wayne State University Massachusetts Institute of Tech. Rutgers University Columbia University
US US US US US US US US US US
17 18 22 23 25 32 37 39 40 45
28.6 25.5 27.1 27.9 18.9 18.3 22.4 17.8 20.7 14.3
8 13 11 10 17 18 14 19 16 23
US US US
46 47 50
15.7 20.9 11.2
21 15 25
US US US
51 52 53
15.0 16.7 13.2
22 20 24
129
Total UnWtd Papers 55.3 42.5 44.8
UnWtd Papers Rank 1 5 4
Table 7.7: Rankings of Top 25 US Affiliations by Total Weighted JBVpages
US Ranking 1 2 3
Total Wtd JBVpgs 461.17 456.09 444.92 393.85
4 5 6
377.52 355.01
7 8 9
335.52 318.00 313.01
10 11
305.39
12 13
278.78 264.75
14 15
228.88 220.15
16 17 18
213.92 202.36 196.61
19 20 21 22 23 24 25
186.63 180.23 179.52 171.59 161.65 154.75
298.41
129.29
Affiliation Georgia State University Harvard University Renssalaer Polytechnic Institute University of Colorado at Boulder Indiana University, Bloomington University of Maryland Case Western Reserve University Babson College University of Pennsylvania University of Minnesota, Minn. Boston University Georgia Institute of Technology Ohio State University University of Calif. Las Angeles University of South Carolina Massachusetts Institute of Tech. Iowa State University Stanford University University of Michigan, Ann Arbor University of Central Florida Utah Slate University Columbia University Baylor University Rutgers University Wayne State University
130
Cntry US US
Global Wtd Papers Rank 5 1
US
4
US
7
US US
10 12
694.83 553.64
4 7
US US US
13 8 18
677.03 318.00 492.87
5 18 10
US US
17 14
534.43 477.03
8 11
US US
23 22
511.43 474.47
9 12
US US
45 37
314.69 398.62
19 13
US US US
51 25 39
326.08 268.72 350.09
17 21 15
US US US US US US US
46 40 47 53 32 52 50
277.81 341.13 374.35 236.68 220.65 237.16
20 16 14 23 24 22 25
Total UnWtd JBVpgs 883.71 615.52
UnWtd JBVpgs Rank 1 6
707.37 852.10
3 2
151.00
Table 7.8: Rankings of Top 25 Non-US Affiliations by Total Weighted Papers
Non-US Ranking 1 2
Global Wtd Papers Ranking 2 3
Total Wtd Papers 34.83 29.93
3 4 5 6
6 9 11 15
22.01 19.18 17.45 15.73
7
16
15.36
8
19
14.67
9 10 11 12 13 14 15 16
20 21 24 26 27 28 29 30
14.26 14.21 13.67 13.29 13.05 13.01 12.72 12.57
17 18 19 20
31 33 34 35
12.21 11.45 11.45 11.22
21 22 23 24
36 38 41 42
11.21
25
43
10.51
10.66 10.58 10.52
Affiliation University of Nottingham University of Warwick Indian Institute of Management Jönköping University Erasmus University University of Calgary National University of Singapore Manchester Metropolitan University Stockholm University University of Alberta University of Amsterdam University of Cambridge University of Aberdeen London Business School University of Strathclyde Imperial College London Nanyang Technological University University of Stirling Bocconi University Newcastle University University of Quebec, Three Rivers Free university University of Toronto University of Durham Helsinki University of Technology
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Total UnWtd Papers 55.2 45.5
UnWtd Papers Rank 1 2
India Sweden Netherlands Canada
21.1 31.0 32.7 22.0
10 4 3 9
Singapore
20.6
11
UK
18.4
20
Sweden Canada Netherlands UK Scotland UK Scotland UK
26.6 22.7 19.3 18.5 20.0 30.3 22.5 19.3
6 7 14 tied 18 tied 13 5 8 14 tied
Singapore Scotland Italy UK
15.7 18.7 16.4 14.6
25 17 24 26
Canada Netherlands Canada UK
14.5 16.5 18.9 12.3
27 23 16 28
Finland
20.1
12
Country UK UK
Table 7.9: Rankings of Top 25 Non-US Affiliations by Total Weighted JBV pages
Non-US Ranking 1 2 3 4
Global Wtd Papers Ranking 2 3 9 11
Total Wtd JBVpgs 680.47 468.75 348.30 294.64
5
19
291.09
6 7
16 21
288.79 282.69
8 9 10
6 15 30
281.89 274.84 263.15
11 12 13 14
33 20 26 27
254.87
15 16 17 18 19
31 44 41 48 34
214.12 213.96 209.52 199.74 196.38
20
43
192.00
21 22
29 28
191.02
23
36
184.33
24 25
49 24
178.86 164.50
243.17 240.47 218.80
186.25
Total UnWtd JBVpgs 1107.93 726.75 562.91 550.89
UnWtd JBVpgs Rank 1 2 3 4
UK
364.11
12
Singapore Canada
375.11 449.79
10 6
India Canada UK
315.15 429.50 352.93
19 7 14
University of Stirling Stockholm University University of Cambridge University of Aberdeen Nanyang Technological University University of Edinburgh University of Toronto York University Bocconi University Helsinki University of Technology
Scotland Sweden UK Scotland
400.36 450.52 324.39 301.35
9 5 18 21
Singapore UK Canada Canada Italy
262.37 335.62 358.62 369.06 270.88
23 16 13 11 22
Finland
338.09
15
University of Strathclyde London Business School University of Quebec, Three Rivers Chinese University of Hong Kong University of Amsterdam
Scotland UK
327.50 402.65
17 8
Canada
230.18
25
Hong Kong Netherlands
312.14 237.30
20 24
Affiliation University of Nottingham University of Warwick Jönköping University Erasmus University Manchester Metropolitan University National University of Singapore University of Alberta Indian Institute of Management University of Calgary Imperial College London
Country UK UK Sweden Netherlands
7.6 Integrating Prior Research: Shane’s (1997) and the Current Study’s Results Shane’s (1997) top authors lists show the top researchers in the world by entrepreneurship publication from 1987 through 1994. Although the same 132
rankings procedure as Shane’s (1997) was used, seven journals and three proceedings were added to Shane’s original list of 19 journals. Comparisons of both Shane’s (1997) lists, and the current study’s lists show that eight researchers remained as top contributors over the combined investigation period, 1987 – 2006 (see Table 7.10). The comparisons also show that since 1995, 17 new names have been added to the list of top author contributors to the entrepreneurship literature. Table 7.10: Top Author Contributors to Entrepreneurship Literature: Across Two Investigation Periods (1987-2006).
On Former and Current Lists 1 2 3 4 5 6
Sue Birley William B. Gartner Harry J. Sapienza Scott A. Shane Paul Westhead Shakar A. Zahra
On Current Lists Only 1 2 3 4 5 6 7 8 9 10 11 12
David B. Audretsch Erkko Autio Robert A. Baron Timothy Bates Candida G. Brush Lowell W. Busenitz James J. Chrisman Marc Cowling Robert C. Cressy Per Davidson James O. Fiet Mark S. Freel
13 14 15 16 17 18 19 20 21 22 23
Benson Honig Colin M. Mason Richard G. P. McMahon Steven C. Michael Peter J. Rosa Dean A. Shepherd Lloyd P. Steier Justin Tan Howard E. Van Auken Mike Wright Andrew L. Zacharakis
Shane’s (1997) top institutions lists similarly show the top affiliations in the world by entrepreneurship publication from 1987 through 1994. When combined with the current study’s lists, we can see that nine universities remained as the top contributors during the combined 20-year investigation period, 1987 through 2006. These universities are listed in Table 7.10. We can also see that 16 133
universities were added as top contributors during the investigation period in this study, 1995 through 2006.
Table 7.11: Top Institutional Contributors to Entrepreneurship Literature: Across Two Investigation Periods (1987-2006). On Former and Current Lists
On Current Lists Only
1 2 3 4
Babson College Georgia Institute of Technology Georgia State University Harvard University
1 2 3 4
Boston University Case Western Reserve University Erasmus University Indian Institute of Management
5
Indiana University
5
Iowa State University
6 7 8 9
University of Colorado University of Maryland University of Pennsylvania University of Warwick
6 7 8 9 10 11 12 13 14 15
Jönköping University Manchester Metropolitan University National University of Singapore Ohio State University Renssalaer Polytechnic Institute University of Alberta University of Amsterdam University of Calgary University of Minnesota, Minneapolis University of Nottingham
7.7 Concluding Remarks This section provides supplementary analyses to the current dissertation. The rankings show which scholars and institutions are thought leaders in developing the broad field of entrepreneurship in general. The findings in this section also provide supplementary information to decision makers in addition to information they receive on rankings of entrepreneurship colleges and programs. The type of information provided in this section should prove useful to a broad range of research constituents, which include deans, tenure and appointment
134
committees, publication editors and editorial boards, and prospective students and faculty to various colleges and programs.
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8.0 EXAMINING OPPORTUNITY RECOGNITION RESEARCH OUTPUT SINCE 1995
8.1 Introduction The purpose of this section is to report supplementary analysis on the critical area of entrepreneurship research that focuses on opportunity recognition using this study’s robust dataset. Some entrepreneurship researchers have argued that the field of entrepreneurship itself lacks consensus about its boundaries (e.g., Bruyat & Julien, 2001; Shane & Venkataraman, 2000). Others have not agreed on a definition of who an entrepreneur is and what entrepreneurship means (e.g., Carland, Hoy, & Carland, 1988; Dollinger, 2003; Gartner, 1988; Hisrich, Peters, & Shepherd, 2005). Yet, no matter how one defines an entrepreneur or the boundaries that one places on entrepreneurship research, the fundamental activity of entrepreneurship is new venture creation (Gartner, 1985; 1990), and researchers can agree that a major component of any entrepreneurial venture is the recognition of the opportunity by the entrepreneur (e.g., Bhave, 1994; Hills, 1994; Shane & Venkataraman, 2000; Timmons, 1994). In 2000, Shane and Venkataraman published a highly influential framework for the field of entrepreneurship in the Academy of Management Review (AMR). As of June 6, 2007, their article had been cited 231 times in the Social Sciences Citation Index (SSCI, 2007), a testament of its influence. Grégoire, Noël, Déry, and Béchard (2006) analyzed 960 full-length articles published in Frontiers of Entrepreneurship Research between 1981 and 2004. They found that for the first time in the four periods they researched (1981-1986, 136
1987-1992, 1993-1998, and 1999-2004), the most frequently cited work was an entrepreneurship-specific piece - the AMR article by Shane and Venkataraman and not a book on personal psychology or competitive strategy. Similarly, Cornelius, Landström
and Persson (2006) found that mainly due to Shane’s
coauthorship of this article, he is the most highly cited individual on the list of key contributors to entrepreneurship publications in terms of helping to develop the research field.
Cornelius and her colleagues (2006)
further assert that Shane is among
a group of new entrants to the core of highly influential thought leaders in entrepreneurship who “…can tell us what the current research questions are, i.e., the research front.” (p. 393) In Shane and Venkataraman’s (2000) conceptual statement about the distinctive domain of entrepreneurship research, opportunity recognition is presented as a central part of the entrepreneurship process. The authors define entrepreneurship as “the scholarly examination of how, by whom, and with what effects opportunities to create future goods and services are discovered, evaluated, and exploited (Venkataraman, 1997).” (p. 218). The authors further explain how entrepreneurial opportunities are discovered by some people, and not others, based on their possession of certain prior knowledge, and on certain cognitive properties. Shane and Venkataraman (2000) encourage researchers to explore their framework, thereby joining in the “quest to create a systematic body of information about entrepreneurship.” (p. 224). The interest in this section is to examine opportunity recognition research within the literature. More specifically, the focus is centered on the question of 137
how much impact the Shane and Venkataraman (2000) article had on the field. Research productivity on opportunity recognition is measured in the time periods before the article was published and after the article was published. The goal was to see if there has been a major shift in opportunity recognition research in response to the article. It was expected that based on the magnitude of the article’s influence, that the frequency of papers published on opportunity recognition would be significantly greater during the years following the publication than during the years prior to, and including, the publication. In addition, this study examined the amount of opportunity recognition research that has been conducted by scholars at the top-ranked entrepreneurship programs. Given the seeming importance of opportunity recognition to the field, it was expected that most of the top programs would be leaders in pushing the field forward by conducting opportunity recognition research.
8.2 Methodology The total number of papers published on entrepreneurship that are captured in the entire dataset is 5,909. Just over half of these papers consisted of journal articles (3,009), and the remaining consisted of entrepreneurship conference proceedings (2,900). As discussed in Section 3.0, because publishing conference papers commands lower stringency requirements, and given the typical earlier stage of development in which many of the papers find themselves, all conference papers in the dataset were assigned a weight of 138
1/10th that of journal papers. Therefore, the total of 2,900 papers published in the three conference proceedings were weighted down to an effective total of 290. When this weighted statistic is added to the 3,009 journal articles, the total weighted number of articles examined in the entire dataset equals 3,299. To conduct this section’s portion of the analyses, data is drawn from only those articles and papers that were published on opportunity recognition (OpRec) in the 29 outlets over the 12-year period. To identify these OpRec papers, each of the dataset’s 5,909 papers (totaling 3,299 weighted papers) were searched to determine whether or not the construct opportunity recognition/discovery is a/the major topic of the paper. A combination of title, abstract, and full text searches were conducted visually, and electronically when available. Editorials, book reviews, and teaching cases were all excluded from the dataset. In total, prior to weighting, 253 papers in the dataset were published on OpRec. The number of these papers that were published in entrepreneurship journals is 74, and the remaining 179 papers were published in the three conference proceedings. Because proceedings were weighted down, the 253 papers compute to a total of 91.9 weighted papers (74 journal articles + (179 proceedings papers *.1) = 91.9 weighted papers). These 91.9 papers were analyzed to test for any shift in the literature. To examine whether opportunity recognition treatment in the literature increased during the years immediately following the AMR article, a comparison was made between those opportunity recognition articles published from 1996-2000 (Period 1), and those published from 2001-2006 (Period 2). 139
Employing the methodologies used by Chan et al. (2006) and Shane (1997), and described in Section 3.0, listings of all authors and their institutional affiliations were computed and ranked. The 91.9 weighted papers written on opportunity recognition account for 2.79 percent of all weighted papers in the dataset. Based on the overall research objectives of this study, these 91.9 papers constitute the subject for analyses in this section. The 91.9 papers were broken down into two periods: one prior to, and one after, the Shane and Venkataraman (2000) AMR publication. To be clear, this study did not conduct content analyses of these papers. Instead, it assessed quantity and not quality and findings within the papers. Finally, the authors’ institutional affiliations are compared to the 2007 Entrepreneur Magazine rankings of the top 25 undergraduate and graduate university programs in entrepreneurship. The rankings can be viewed in Table 7.1. They are also available at Entrepreneurs Magazine’s website (http://www.entrepreneur.com/topcolleges).
8.3 Results 8.3.1 Outlets Publishing on Opportunity Recognition A summary of the total number of opportunity recognition papers appearing in the 29 research outlets examined in this study are presented in Table 8.1. Table 8.1 also shows that throughout the 12-year period, of the 29 publication outlets, 20 published at least one paper on opportunity recognition. 17 of these outlets were entrepreneurship specific or management journals, and 140
three were entrepreneurship conference proceedings. Entrepreneurship Theory and Practice led the 29 publication outlets with 22 OpRec papers published. This was followed by Babson (13.3), Journal of Business Venturing (13), Small Business Economics (9), and Academy of Management Review (7). Tables 8.2 and 8.3 show the breakdown of these OpRec papers by the two time periods, Period 1 and Period 2. As Table 8.2 shows, a weighted total of 36.6 papers were published on opportunity recognition during Period 1 (1995– 2000). These papers were published in 12 of the 29 outlets. Entrepreneurship Theory and Practice again led with 9 OpRec papers, followed by Academy of Management Review (6), Babson (5.3), and Small Business Economics and Journal of Business Venturing with three papers each. The 36.6 papers published on OpRec in Period 1 comprised 2.12 percent of the total entrepreneurship papers published by the 29 outlets in Period 1. By Period 2 (2001-2006), the number of weighted opportunity recognition papers increased substantially to 55.3 (a 51 percent increase). These papers were published in 16 of the 29 outlets. And, yet again, Entrepreneurship Theory and Practice led with 13 OpRec papers published during this period, followed by Journal of Business Venturing (10), Babson (8), Small Business Economics (6), and Journal of Management (5). These 55.3 papers comprised 3.51 percent of the total entrepreneurship papers published in Period 2 by the 29 outlets publishing on opportunity recognition.
141
Table 8.1: OpRec Papers (1995-2006): Frequencies and Percentages
Journals American Journal of Sociology Academy of Management Journal Academy of Management Review American Sociological Review Administrative Science Quarterly California Management Review Economics of Innovation and New Technology* Entrepreneurship and Regional Development* Entrepreneurship Theory & Practice* Harvard Business Review Industry and Innovation* International Small Business Journal* Journal of Business Venturing* Journal of High Tech Mgmt Research* Journal of Management Journal of Management Studies Journal of Entrepreneurship* Journal of Small Business Mgmt* Sloan Management Review Management Science Organizational Dynamics Organization Science Organization Studies Small Business Economics* Strategic Management Journal Stanford Social Innovation Rev. Proceedings Babson Frontiers of Entrepreneurship Research* (wtd to .1) University of Illinois Chicago/AMA* (wtd to .1) United States Assoc. of Small Bus. Enterprises* (wtd to .1) Total
OpRec Papers 3 1 7 0 1 0 0 2 22 0 0 1 13 0 5 0 2 1 1 2 0 2 1 9 1 0
Total E’ship Papers 12 23 17 9 13 16 295 242 259 69 167 244 354 191 24 11 125 273 16 26 7 14 19 520 43 20
13.3 (133) † 4.4 (44) .2 (2) 91.9 (253)
181 (1810) 40 (400) 69 (690) 3299 (5909)
* Denotes entrepreneurship specific publication outlets. † Numbers in parentheses show actual number of papers prior to weighting.
142
Percent 25.00% 4.35% 41.18% 7.69% 0.83% 8.49% 0.41% 3.67% 20.83% 1.59% 0.37% 6.25% 7.69% 14.29% 5.26% 1.73% 2.31% -
7.35% 11.00% 0.29% 2.79% (4.28%)
Table 8.2: Period 1 OpRec Papers (1995-2000): Frequencies and Percentages
Journals American Journal of Sociology Academy of Management Journal Academy of Management Review American Sociological Review Administrative Science Quarterly California Management Review Economics of Innovation and New Technology Entrepreneurship and Regional Development Entrepreneurship Theory & Practice Harvard Business Review Industry and Innovation International Small Business Journal Journal of Business Venturing Journal of High Tech Mgmt Research Journal of Management Journal of Management Studies Journal of Entrepreneurship Journal of Small Business Mgmt Sloan Management Review Management Science Organizational Dynamics Organization Science Organization Studies Small Business Economics Strategic Management Journal Stanford Social Innovation Rev. Proceedings Babson Frontiers of Entrepreneurship Research (wtd to .1) University of Illinois Chicago/AMA (wtd to .1) United States Assoc. of Small Bus. Enterprises (wtd to .1) Total
OpRec Papers 2 0 6 0 0 0 0 1 9 0 0 0 3 0 0 0 2 0 1 0 0 2 0 3 0 0
Total E’ship Papers 9 12 11 5 6 8 122 131 130 37 80 132 177 119 8 7 83 147 6 6 3 9 8 291 27 0
5.3 (53) 2.1 (21) .2 (2) 36.6 (105)
86 (860) 26 (260) 39 (390) 1724 (3083)
Percent 22.22% 54.55% 0.76% 6.92% 1.70% 2.40% 16.67% 22.22% 1.03% -
6.16% 8.08% 0.51% 2.12% (3.41%)
* Numbers in parentheses show actual number of papers prior to weighting.
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Table 8.3: Period 2 OpRec Papers (2001-2006): Frequencies and Percentages
Journals American Journal of Sociology Academy of Management Journal Academy of Management Review American Sociological Review Administrative Science Quarterly California Management Review Economics of Innovation and New Technology Entrepreneurship and Regional Development Entrepreneurship Theory & Practice Harvard Business Review Industry and Innovation International Small Business Journal Journal of Business Venturing Journal of High Tech Mgmt Research Journal of Management Journal of Management Studies Journal of Entrepreneurship Journal of Small Business Mgmt Sloan Management Review Management Science Organizational Dynamics Organization Science Organization Studies Small Business Economics Strategic Management Journal Stanford Social Innovation Rev. Proceedings Babson Frontiers of Entrepreneurship Research (wtd to .1) University of Illinois Chicago/AMA (wtd to .1) United States Assoc. of Small Bus. Enterprises (wtd to .1) Total
OpRec Papers 1 1 1 0 1 0 0 1 13 0 0 1 10 0 5 0 0 1 0 2 0 0 1 6 1 0 8 (80) 2.3 (23) 0 55.3 (148)
Total E’ship Papers 3 11 6 4 7 8 173 111 129 32 87 112 177 72 16 4 42 126 10 20 4 5 11 229 17 20 95 (950) 13 (130) 31 (310) 1575 (2826)
Percent 33.33% 9.09% 16.67% 14.29% 0.90% 10.08% 0.89% 5.64% 31.25% 0.79% 10.00% 9.09% 2.62% 5.97% -
8.42% 17.69% 3.51% (5.24%)
* Numbers in parentheses show actual number of papers prior to weighting.
8.3.2 Researcher Productivity on Opportunity Recognition From 1995 to 2006, a total of 331 authors published the 91.9 weighted
144
OpRec papers in the 29 publication outlets. Table 8.4 shows the top 25 of these authors. Appendix D extends this rankings list to include the top 100 authors by actual numbers of OpRec papers published, weighted by journal article or conference proceedings. During this combined period, 21 journal articles and 48 (non-weighted) proceedings papers were written by sole authors. The remaining papers were written by between 2 and 9 authors. In Period 1, a total of 99 authors published the 36.6 papers that were published on OpRec during the period. The number of these authors who were a sole author in a journal article is seven. The remaining journal authors collaborated with between one and five coauthors. In the same period, 14 proceedings papers were written by a sole author, and the remaining papers were written by between 2 and 6 authors. Table 8.5 shows the top ranked authors in Period 1 ranked by numbers of weighted OpRec papers published during the period. This table also shows the authors’ most recent affiliations (and countries) listed in all papers. In Period 2, the number of authors who published the 55.5 weighted OpRec papers nearly tripled to 272 (see Table 8.6 for the top ranked Period 2 authors). The number of authors who solely published a journal article in Period 2 is 14. The remaining Period 2 authors collaborated with between one and eight coauthors. The number of sole authors writing proceedings papers during this period is 34. The remaining Period 2 papers were written by between two and five authors. The number of authors who published OpRec papers in both periods (i.e., the number of authors who published at least one paper in Period 1, 145
and at least one other paper in Period 2) is 40. The number who published in Period 1 only is 59, and the number who published in Period 2 only, nearly quadrupled to 232.
Table 8.4: Top 29 Authors for Weighted Opportunity Recognition Papers in Combined Periods (1995 - 2006)
Rank 1 2 3 6 7 8 9 10 11 14 15 17
18
Total Wtd Papers 2.50 2.33 2.00 2.00 2.00 1.94 1.87 1.62 1.60 1.50 1.43 1.43 1.43 1.20 1.15 1.15 1.05 1.00
Author Scott A. Shane Robert A. Baron Lowell W. Busenitz Gregory G. Dess Maria Minniti Sankaran Venkataraman G. Thomas Lumpkin Dean A. Shepherd Connie Marie Thomas B. Ward Norris F. Krueger, Jr. Deniz Ucbasaran James O. Fiet Robert P. Singh Andrew C. Corbett Paul Westhead Pia Arenius Silvia Dorado
1.00 1.00 1.00
Truls Erikson Denise E. Fletcher Benson Honig
1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
Elaine Mosakowski Joel Podolny Diamanto Politis Robert D. Russel Sukhpal Singh Raymond W. Smilor Robert J. Sternberg Toby E. Stuart
Affiliation University of Maryland Renssalaer Polytechnic Institute University of Oklahoma University of Kentucky Babson College
Country US US US US US
University of Virginia University of Illinois at Chicago Indiana University, Bloomington San Francisco State University University of Alabama Boise State University University of Nottingham University of Louisville Morgan State University Renssalaer Polytechnic Institute University of Warwick University of Lausanne University of Massachusetts Manchester Metropolitan University University of Sheffield University of Haifa University of California Las Angeles Stanford University Lund University Pennsylvania State University Institute of Rural Management Kauffman Foundation Yale University Columbia Business School
US US US US US US UK US US US UK Switzerland US
146
UK UK Israel US US Sweden US India US US US
Table 8.5: Top 26 Authors for Weighted OpRec Papers in Period 1 (1995-2000)
Rank 1 3 4 5 8
9
Total Wtd Papers 1.500 1.500 1.200 1.033 1.000 1.000 1.000 0.717 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500
Author Lowell W. Busenitz Scott A. Shane Norris F. Krueger Jr James O. Fiet Elaine Mosakowski Raymond W. Smilor Robert D. russel G. Thomas Lumpkin D. Ray Bagby Julian Birkinshaw William D. Bygrave Gregory G. Dess Nick Fry James G. Hunt Mariann Jelinek E. Sendil Misra Kumar Chung-ming lau Joseph A. Litterer G. Dale Meyer Maria Minniti Sasi Misra Leslie E. Palich Arja Ropo Dean A. Shepherd S. Venkataraman G. Page West III
Affiliation University of Houston University of Maryland Boise State University Jönkoping University University of Calif. Las Angeles Kauffman Foundation Pennsylvania State University University of Illinois at Chicago Baylor University Stockholm University Babson College University of Texas at Arlington University of Western Ontario Texas Tech University College of William & Mary University of Pennsylvania Chinese University of Hong Kong University of Massachusetts University of Colorado at Boulder Babson College Indian Institute of Management Baylor University University of Tampere University of Colorado at Boulder University of Virginia Wake Forest University
147
Country US US US Sweden US US US US US Sweden US US Canada US US US Hong Kong US US US India US Finland US US US
Table 8.6: Top 25 Authors for Weighted OpRec Papers in Period 2 (2001-2006)
Rank 1 2
3 6 7 8 10 11 12
13
Total Wtd Papers
Author
2.150
Robert A. Baron
1.570
Dean A. Shepherd
1.500 1.500 1.500 1.440 1.400
Connie Marie Gaglio Maria Minniti Thomas B. Ward S. Venkataraman Deniz Ucbasaran
1.150
Andrew C. Corbett
1.150 1.117 1.050 1.025
G. Thomas Lumpkin Paul Westhead Pia Arenius Robert P. Singh
1.000 1.000 1.000
Nancy J. Birch Gregory G. Dess Silvia Dorado
1.000 1.000
Truls Erikson Denise E. Fletcher
1.000 1.000 1.000 1.000 1.000
David J. Hansen Benson Honig Joel Podolny Diamanto Politis Scott A. Shane Sukhpal Singh
1.000 1.000 1.000
Affiliation Renssalaer Polytechnic Institute Indiana University, Bloomington San Francisco State University Babson College University of Alabama University of Virginia University of Nottingham Renssalaer Polytechnic Institute University of Illinois at Chicago University of Warwick University of Lausanne Morgan State University Eastern Washington University University of Kentucky University of Massachusetts Manchester Metropolitan Univ. University of Sheffield University of Illinois at Chicago University of Haifa Stanford University Lund University University of Maryland Institute of Rural Management Yale University Columbia Business School
Robert J. Sternberg Toby E. Stuart
Country US US US US US US UK US US UK Switzerland US US US US UK UK US Israel US Sweden US India US US
8.3.3 Affiliation Productivity on Opportunity Recognition From 1995 to 2006, a total of 194 affiliations were noted in the 91.9 weighted OpRec papers published in the 29 publication outlets. Table 8.7 shows 148
the top 25 of these affiliations based on numbers of weighted OpRec papers published throughout the entire period, from 1995 to 2006. Renssalaer Polytechnic Institute is ranked first with 4.417 weighted papers published on opportunity recognition. Immediately following are University of Nottingham and Babson College with 3.820 and 2.933 weighted papers each. Appendix E extends this rankings list to include the top 100 affiliations by actual numbers of OpRec papers written, weighted by journal article or conference proceedings. In Period 1, a total of 70 affiliations were noted in the 36.6 weighted OpRec papers published in the major entrepreneurship outlets. Table 8.8 shows the top ranked of these affiliations for OpRec publications in Period 1 ranked by weighted OpRec papers. University of Houston and University of Maryland were ranked first with 1.5 weighted OpRec papers each during this period. Monash University and San Francisco State University tied for third with 1.1 weighted OpRec papers each. In Period 2, a total of 155 affiliations were noted in the 55.3 weighted OpRec papers published in the major outlets (see Table 8.9 for the top ranked of these affiliations). During this period, the numbers of weighted OpRec papers affiliated with the first and second ranked institutions more than doubled to 3.800 and 3.753. Renssalaer Polytechnic Institute is the top ranked institutional affiliation with its 3.800 weighted OpRec papers during this period. Ranking in second place is University of Nottingham with 3.753 weighted OpRec papers during the period. The numbers of papers affiliated with the third and fourth top ranked institutions also more than double in Period 2. With 2.000 weighted 149
OpRec papers in this period, Eastern Washington University is ranked third. And, with 1.990 weighted OpRec papers in the period, University of Illinois at Chicago is ranked fourth. Out of the total 194 institutions affiliated with the OpRec papers published in the 29 publication outlets from 1995 to 2006, 32 published OpRec papers in both Period 1 and Period 2. The number of affiliations that published in Period 1 is 38. But, the number that published in Period 2 only more than quadruples to 124.
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Table 8.7: Top 26 Affiliations for Total Weighted Opportunity Recognition Papers in Combined Periods (1995-2006)
Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 18 19 20 21 22 23 24 25
Affln Wtd Papers 4.417 3.820 2.933 2.907 2.600 2.500 2.000 1.944 1.930 1.723 1.717 1.650 1.551 1.500 1.500 1.500 1.500 1.292 1.267 1.217 1.167 1.133 1.100 1.058 1.050 1.050
Affiliation Renssalaer Polytechnic Institute University of Nottingham Babson College University of Illinois at Chicago San Francisco State University University of Maryland Eastern Washington University University of Virginia University of Colorado at Boulder University of Louisville University of Western Ontario Baylor University Jönkoping University University of Alabama University of California Las Angeles University of Houston University of Massachusetts at Boston Indiana University, Bloomington Boise State University University of Texas at Arlington University of California at Berkeley University of Minnesota, Minneapolis University of Aberdeen University of the Pacific Clemson University Stockholm University
151
Affln Country US UK US US US US US US US US Canada US Sweden US US US US US US US US US Scotland US US Sweden
Table 8.8: Top 28 Affiliations for Total Weighted OpRec Papers in Period 1 (1995-2000)
Rank 1 3
5
12 13 14 16 17
18
Total Wtd Papers 1.500 1.500 1.100 1.100 1.000 1.000 1.000 1.000 1.000 1.000 1.000 0.917 0.700 0.617 0.617 0.583 0.550 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500
Affiliation University of Houston University of Maryland Monash University San Francisco State University Babson College Baylor University Boise State University Clemson Univeristy Kauffman Foundation Pennsylvania State University University of California Las Angeles University of Illinois at Chicago Stockholm University Renssalaer Polytechnic Institute Renssalaer Polytechnic Institute University of Colorado at Boulder University of Texas at Arlington Chinese University of Hong Kong College of William & Mary Indian Institute of Management Northeastern State University Texas Tech University University of Massachusetts University of Pennsylvania University of Tampere University of Virginia University of Western Ontario Wake Forest University
152
Country US US Australia US US US US US US US US US Sweden US US US US Hong Kong US India US US US US Finland US Canada US
Table 8.9: Top 34 Affiliations for Total Weighted OpRec Papers in Period 2 (2001-2006)
Rank 1 2 3
4 5 6 7 10 11 12 13 14
15 16
17
18
Total Wtd Papers 3.800 3.753 2.000 1.990 1.933 1.723 1.500 1.500 1.500 1.451 1.444 1.347 1.292 1.217 1.167 1.100 1.033 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000
Affiliation Renssalaer Polytechnic Institute University of Nottingham Eastern Washington University University of Illinois at Chicago Babson College University of Louisville San Francisco State University University of Alabama University of Massachusetts at Boston Jönkoping University University of Virginia University of Colorado at Boulder Indiana University, Bloomington University of Western Ontario University of California at Berkeley University of Aberdeen University of Minnesota, Minneapolis Columbia University Drexel University Free University Institute of Rural Management Lund University Manchester Metropolitan University Memorial University of Newfoundland National University of Singapore Stanford University University of Auckland University of Haifa University of Kentucky University of Lausanne University of Maryland University of Sheffield University of the Pacific Yale University
Country US UK US US US US US US US Sweden US US US Canada US Scotland US US US Netherlands India Sweden UK Canada Singapore US New Zealand Israel US Switzerland US UK US US
8.3.4 Productivity by “Top Ranked” Programs Finally, this section examined which of the universities with top-ranked 153
entrepreneurship programs published opportunity recognition papers over the 12year period, 1995 through 2006. As discussed in Section 7.0, a total of 37 universities comprise the two Top 25 lists in Entrepreneur Magazine 's 5th Annual Top 50 Entrepreneurial Colleges for 2007 (undergraduate and graduate programs combined). As explained earlier, the reason why the number of universities comprising this list is 37, and not 50, is because 13 universities are ranked on both lists (see Table 7.1). Table 8.10: Top Ranked Entrepreneurship Magazine Universities that Published Opportunity Recognition Papers Period 1 Number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
OpRec Publishing by “Top 50” Babson College Baylor University Brigham Young University Chapman University Depaul University Drexel University Indiana University, Bloomington Northeastern University Ohio State University University of Alabama University of California, Los Angeles University of Colorado, Boulder University of Houston University of Illinois at Chicago University of Illinois, UrbanaChampaign University of Iowa University of Maryland University of North Carolina Chapel Hill University of Oklahoma University of Southern California
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Period 1
Period 2
+
only
only
Period 2
x x
10
18
8
Of these 37 top entrepreneurial universities, only 20 published any OpRec papers in the entrepreneurship publication outlets over the 12-year period (see Table 8.10). Ten of these top universities published OpRec papers in Period 1, and by Period 2, this number increased to 18 out of the 20. That is, two of the 20 universities had published OpRec papers in Period 1 only. Eight of the ten universities publishing OpRec papers in Period 1 also published OpRec papers in Period 2. Ten universities published their first OpRec papers in Period 2.
8.4 Discussion of Findings The overall number of papers written on entrepreneurship topics in general was 1,725 in Period 1. In Period 2, this number decreased nearly nine percent to 1,575. The number of entrepreneurship papers written in nonentrepreneurship specific journals increased nearly 10 percent from 242 in Period 1 to 265 in Period 2. The number of entrepreneurship papers written in either entrepreneurship specific journals or conferences decreased nearly 12 percent from 1,483 papers in Period 1 to 1,310 papers in Period 2. At the outset of this query, this section sought to determine if post-Shane and Venkataraman (2000) researcher-investigations on the topic of opportunity recognition increased in response to the article. The results clearly indicate a substantial increase in these investigations. The results also show that the journal Entrepreneurship Theory and Practice has been a leading outlet for knowledge advancement in this critical area of research inquiry. Two additional publication outlets that are major contributors are Journal of Business Venturing 155
and Small Business Economics. Babson College’s Frontiers of Entrepreneurship Research is the leading contributor among conference proceedings, and is closely trailed by UIC/AMA. In addition, a relatively small percentage of topranked entrepreneurship programs have contributed to the literature development of the field. These findings are further discussed below. Of the 3,299 weighted papers published in the 29 publication outlets analyzed in this investigation, the proportion of opportunity recognition papers is 2.79 percent. The percentage of opportunity recognition papers out of all weighted entrepreneurship papers published in the first period is 2.12 percent (36.6 papers). By the second period this percentage drastically increased to 3.51 percent (55.3 papers). These findings indicate slightly more than a 51 percent increase in the proportion of opportunity recognition papers from Period 1 to Period 2, providing support for this study’s research hypothesis that the Shane and Venkataraman article has contributed to increased focus on opportunity recognition. Moreover, the percentage of opportunity recognition papers devoted to non-entrepreneurship specific journal outlets slightly increased 4.55 percent (11 OpRec papers out of 242 papers) in Period 1 to 4.91 percent (13 OpRec papers out of 265 papers) in Period 2. The percentage of opportunity recognition papers devoted to either entrepreneurship specific journals or proceedings nearly doubled from 1.73 percent (25.6 OpRec papers out of 1,483 papers) in Period 1 to 3.23 percent (42.3 out of 1,310 papers) in Period 2. These figures thereby provide further support for this study’s research hypothesis. 156
The increase is observed in 13 of the 29 publication outlets through actual numbers of papers published on opportunity recognition from Period 1 to Period 2. The increase is also observed in 15 of the 29 publication outlets in the proportions of each outlet’s publications that are dedicated to opportunity recognition from Period 1 to Period 2. Nonetheless, five outlets experienced a decline in numbers of OpRec papers published, and five experienced a decline in percentage of publications dedicated to opportunity recognition. Finally, one outlet published the same number of papers in both periods, while also slightly increasing its proportion of OpRec publication in Period 2 over Period 1. As stated above, of the 37 universities listed as top entrepreneurial programs for 2007, only 10 published opportunity recognition papers in Period 1. And, although this number nearly doubled to 18 universities in Period 2, it still represents less than one half of the programs that are ranked as the leading institutions advancing critical knowledge on entrepreneurship. Obviously, many of the researchers at these top programs are focused on other areas of inquiry. However, given the importance of opportunity recognition to the entrepreneurship process, these results are somewhat surprising given the reasonable expectation that more of the top entrepreneurship programs assume responsibility in growing the body of opportunity recognition research.
8.5 Future Research Needs and Opportunities for Researchers Again, this section does not look at content, but instead, queries the state of the overall body of literature on opportunity recognition. Given the growing 157
numbers of papers, it is clear that there is great interest in opportunity recognition. An analysis of the overall content and findings, or perhaps even a meta-analysis, may now be in order to try to isolate the most important aspects of the opportunity recognition process. Using the opportunity recognition papers identified in this dataset, this study aims to embrace such an analysis in the near future. Given the importance of the area and the fact that so few of the top entrepreneurship programs have published papers advancing opportunity recognition knowledge, it still appears that opportunity recognition remains a good niche area of research. Scholars who are still relatively unknown, and/or are from smaller or “lesser-known” entrepreneurship programs can certainly establish themselves and their programs by publishing just a few papers in this area.
8.6 Concluding Remarks This section of the dissertation shows the most prolific scholars and the institutions that have led in answering Shane and Venkataraman’s (2000) call for researchers to explore their framework in order to systematically advance the field. In doing so, the section also serves as evidence of the field’s continued advancement and maturation. There are three major findings. First is that there has been a major increase in the number of opportunity recognition papers since Shane and Venkataraman (2000) published their AMR piece. Second, surprisingly, only a small portion of the papers published on opportunity 158
recognition are generated by the leading entrepreneurship programs. And third, that the Entrepreneurship Theory and Practice, Journal of Business Venturing, and Small Business Venturing journal outlets, as well as the Babson College Frontiers of Entrepreneurship Research and UIC/AMA proceedings outlets, are the leading publication outlets for opportunity recognition research. These findings provide further support for the substantial influence of Shane and Venkataraman’s (2000) article to the field. To the researcher’s knowledge, this section provides a first detailed assessment of research productivity on a specific and major component of any entrepreneurial venture: the recognition of the opportunity by the entrepreneur.
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9.0 CONCLUDING REMARKS
9.1 Major Contributions This dissertation provides two major contributions to the entrepreneurship literature. First, it provides the first comprehensive survey of the papers published on black entrepreneurship that are contained in the literature. Second, it provides rankings of the most prolific researchers and affiliations publishing in two areas: •
On black entrepreneurship
•
By Historically Black Colleges and Universities
Additional contributions are the dissertation’s supplementary findings that rank researchers and institutions by their quantitative publication on entrepreneurship in general, and on opportunity recognition: an important research component of the entrepreneurship process. The findings on black entrepreneurship and on HBCU research contribute to the literature by highlighting areas related to a critical under-researched population: black entrepreneurs in the U.S. These findings provide an important first step in understanding where increased research effort is needed in order to enhance the successful outcome rates of black Americans engaged in entrepreneurship. The contributions of this study also provide value to a broad population. This population includes university constituents wishing to compare top entrepreneurship programs based primarily on their research output. It
160
likewise includes researchers and affiliations wishing to gage their relative standings among peers. This study also points out that the entrepreneurship literature consistently shows that black Americans have the highest levels of entrepreneurial propensity among all of the major ethnic populations they have been compared to in the entrepreneurship literature. Black youth show higher levels of entrepreneurial propensity then other groups; and prospective black entrepreneurs exhibit higher levels of optimism than other groups. While black Americans have the highest nascent entrepreneurship rates of all researched groups, they also have the lowest established business ownership rates. The entrepreneurship literature also shows that black entrepreneurs of established businesses are less educated, more often single, and younger than other entrepreneurs. Each of these traits negatively impacts blacks with respect to entrepreneurship in terms of leading to established business ownership. Finally, this study shows that the entrepreneurship literature strongly supports that black entrepreneurs employ a variety of measures as outcomes of venture success. This tendency exists in lieu of solely relying on economic outcomes and indicators as measures of venture success. Examples include providing family support, and community involvement and support. The literature also shows that black entrepreneurship is quite unique compared to other major groups in the U.S. Blacks are more likely than others to engage in externally stimulated opportunity recognition, and less likely than others to engage in internally stimulated opportunity recognition (Singh, Knox, & 161
Crump, 2008). Moreover, the well-established connection between having an entrepreneurial father and becoming an entrepreneur does not hold for blacks. Instead, blacks are unique in that having an entrepreneurial mother is a stronger predictor of entrepreneurship for them than having an entrepreneurial father (Singh, Crump, & Zu, 2007). The entrepreneurship literature shows that black entrepreneurs often choose entrepreneurship over wage work because they perceive themselves as negatively impacted by unfair practices in the labor market. Also, as Section 2.0 explains, highly urban environments are characterized as economic areas of retail scarcity, housing an estimated $25 billion dollars of unmet consumer demand. The section proposed that the proportion of black entrepreneurs operating in urban environments is overly disproportionate relative to the proportion operating in non-urban environments. Indeed, Reynolds et al. (2004) showed that among blacks, whites, and Hispanics, the positive relationship between urban residence and nascent entrepreneurship prevalence is strongest for black men and women. Yet, White and Reynolds (1997) found that blacks in Wisconsin show no differences in entrepreneurship rates compared to other groups. This suggests that as blacks live in more rural areas, or in areas with lower black population density, they are less likely to operate in the informal economy. The broader sociology literature shows that blacks relative to other groups in the U.S. lack high levels of trust towards other groups. Coupled with their high likelihood of perceiving that they are viewed as outsiders by the mainstream 162
wage-employment sector (Dollinger, 2003), it is conceivable that black entrepreneurs, more so than other groups, opt out of the formal economy, yet remain in entrepreneurship, nonetheless. As discussed in Section 2.0, blacks may be operating businesses in the informal economy. Reynolds et al.’s (2004) finding that blacks with graduate education are two to three times more likely to be involved in entrepreneurship education suggests that blacks with increased education more easily “know” how to operate successfully in the formal economy. These conceptions may thereby help to explain a substantial portion of the underrepresentation of black entrepreneurship in the formal economy. In doing so, they may aid in explaining why blacks are overrepresented in nascent entrepreneurship, yet underrepresented in establish business ownership.
9.2 Unanswered Research Questions There are many unanswered questions and numerous research directions that can be pursued. Several of the important questions that remain unanswered in the literature are: 1)
What happens to the large portion of black nascent entrepreneurs whose ventures do not become established businesses? i. Do they find refuge in the informal economy? ii. Do they revert to sole reliance on wage-work? iii. Do they become serial nascent entrepreneurs?
2)
What (if any) are the opportunity costs to black entrepreneurs who operate in part or in toto in the informal economy? 163
3)
Are the opportunity costs in question 2 above hidden to these entrepreneurs?
4)
Do a substantial portion of the entrepreneurs in question 2 ever convert all or part of their businesses into the formal economy, at some point?
5)
If the answer to Question 4 above is “Yes,” then which knowledge or tangible resources would facilitate such a conversion.
9.3 HBCU Research Output This study has argued the importance of HBCU-led research efforts in answering the unanswered questions above. Perhaps one of the major problems perpetuating the black-white entrepreneurship founding rate gap that has persisted for nearly 90 years (Fairlie 2004; Fairlie & Meyers, 2000) is the current research paradigms. Robinson et al. (2005) rightfully highlight that, Research that privileges one group, by norming their experience such that another group’s appears lacking in comparison, lacks nuance, results in competing theoretical explanations, and generates ascriptions which have been challenged by our work and by other researchers whose work is noted herein. (p. 16) This statement speaks to the probability that we may discover that the tools used to measure, and the language used to portray, black entrepreneurship may be invalid for a substantial portion of black entrepreneurs in the U.S. This study has highlighted the pervasive existence of contradictions and idiosyncrasies specific to black entrepreneurship. Current entrepreneurship literature essentially normalizes the practices of majority white entrepreneurs in the U.S. Then, the 164
literature benchmarks black entrepreneurship against those models portrayed in the literature. Yet, the literature also shows that if black entrepreneurs follow those same models, they often experience extremely different outcomes: usually to their detriment. For example, the literature reports that black entrepreneurs frequently experience lending discrimination when seeking formal financing. This discrimination is absent in the current entrepreneurship models that apply specifically to white, and to a lesser extent, Asian, entrepreneurs. If black entrepreneurs follow these models that do not consider racial discrimination, models that are ascribed in the literature, and therefore taught in college classrooms, then we can expect unfavorable outcomes to continue for these entrepreneurs if they do in fact experience discrimination. Further, the fact that research has found black entrepreneur respondents’ who perceived discriminatory lending practices is evidence that perceived discrimination, and perhaps real discrimination, are crucial variables in the actual business environment they confront. The absence of this variable in entrepreneurship theory and literature, and subsequently taught in college classrooms is likely to contribute to the alienation of numerous entrepreneurs who have perhaps concluded that the extant entrepreneurship literature is incomplete for them, and therefore irrelevant. Such alienation would help to perpetuate the lower levels of education among established business owners that has been well documented in the literature.
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As argued in this study, HBCUs are uniquely positioned to ascertain any idiosyncratic models that pertain to the under-researched black population. HBCUs more specifically serve black communities. Often, their missions include providing knowledge and education to [black] members of the U.S. population who would otherwise not receive such training. Yet, as this study shows, no HBCU researchers published any papers on black entrepreneurship during the 12-year period in the 29 major outlets examined in this work. All of the papers published on black entrepreneurship in the dataset were published by researchers affiliated with non-HBCU institutions. This situation illuminates an unexplored research frontier that offers promise in helping to advance the missions of HBCUs. If HBCU research provides increased focus on the entrepreneurship populations to which many of their students belong, one could rightfully expect the generation of new knowledge that specifically relates to black entrepreneurs. The results of such HBCU-lead efforts could ultimately reduce the underrepresentation of black Americans in successful entrepreneurship. It could also help address the underrepresentation of blacks in higher education.
9.4 Limitations of Study Certain limitations to this study have been identified. First, at the time of data collection, basic citation information only, was available for all USASBE papers. None of the full text papers in USASBE could be accessed. Also, many of the Babson papers were one-page summaries. Therefore, some measures for 166
opportunity recognition, black entrepreneurship, or HBCU status are likely to have escaped capture in this study’s dataset. Hence, many of the statistics presented in this manuscript are likely understated. Second, this paper treats researchers as HBCU researchers only when the affiliation(s) listed on their papers is an HBCU. This paper does not consider as HBCU output papers published by researchers who were trained or experienced at HBCUs but who have moved on to non-HBCU institutions. Therefore, HBCUs may be indirectly contributing to black entrepreneurship research, yet their contributions may not be fully captured in this study. Third, many of this study’s findings are derived from prior studies that measured entrepreneurship based on people’s self-employment status. Yet, researchers differ on whether self-employment constitutes entrepreneurship or not. Nonetheless, based on the prevalent treatment in the literature of selfemployment as an estimate of entrepreneurship, one can say that selfemployment to a large degree equates to entrepreneurship (Bingham & Melkers, 1989; Blanchflower & Oswald, 1992; Butler & Herring, 1991; Fairlie & Robb, 2007; Hout & Rosen, 2000; Lentz & Laband, 1990). Fourth, many of this study’s findings are likewise derived from prior studies that relied on U.S. Census data. Thus, the validity of much of the knowledge concerning black entrepreneurship relies on the validity of the Census data. But, as this study has presented, compelling evidence exists supporting the notion that the validity of U.S. Census data is substantially diminished for black populations. 167
The fifth and final limitation concerns the source from which many of this study’s findings are drawn. As explained earlier, many of the research findings reported the literature often do not distinguish between those that pertain only to nascent entrepreneurs (those in the process of founding a venture), and those that pertain only to established entrepreneurs. The findings derived from either of these distinct population segments are often generalized to the broader set of all entrepreneurs. But, as this study shows, these two distinct population segments often display attributes that run counter to each other. But, if researchers do not specify which type of entrepreneur their findings relate to, then readers might inadvertently and inaccurately assign findings to either one or both of the entrepreneur types. Or, readers may perceive contradictions in the literature, when in actuality none exist. To illustrate, Fairlie (2004) found a positive relationship between entrepreneurship and marital status. Yet, Reynolds et al., (2004) found that black women are the only group among black, white, and Hispanic men and women for which being married positively and significantly increases the likelihood of being an entrepreneur. Yet, when type of entrepreneur is factored in, it becomes evident that Fairlie’s (2004) finding applies only to non-nascent entrepreneurs, and Reynolds et al.’s (2004) finding applies only to nascent entrepreneurs. Another example that could lead one to incorrectly perceive a contradiction is where Fairlie (2004) found a positive relationship between age and entrepreneurship, and Crosa et al. (2002) found a curvilinear relationship 168
between age and entrepreneurship. However, when type of entrepreneur is factored in, we can see that Fairlie’s (2004) findings applies to non-nascent entrepreneurs, and Crosa et al. (2002) finding applies to nascent entrepreneurs. Therefore, researchers and readers should place greater emphasis in specifying to which entrepreneur group their findings are generalized. In doing so, readers will be less likely to perceive contradictions within the literature, when in actuality, none exist. Fortunately, Fairlie (2004), Reynolds et al. (2004), and Crosa et al. (2002) all set fine examples by appropriately notifying readers of the types of entrepreneurs for which their findings apply. Other studies are not as clear whether their findings apply to one group or the other. Perhaps still others failed to make the distinction in measuring respondents. Yet, such distinctions are critical in order to derive valid findings on entrepreneurs.
9.5 Future Research Directions Several future research directions if taken in the entrepreneurship literature would enhance the findings of this study. First, future research could test the suggested theoretical relationships discussed in Section 2. The relationship between black population density and opportunity exploitation can be measured using PSED and/or GEM datasets, and crossing checking that data against U.S. Census data. Retail scarcity could be empirically determined by geographic area. The construct could then be regressed against the entrepreneurship exploitation of black versus other groups of entrepreneurs. 169
This type of study could also rely on datasets similar to the PSED or the GEM. Alternatively, a survey could be administered to measure the opportunity exploitation of respondents within a same geographic area. Black distrust, perceptions of corruption, perceptions of firm performance, and disparity in trade processes between black and white entrepreneurs, could also be measured using survey questionnaires. Second, future research should develop more accurate explanatory and predictive models of black entrepreneurship that can inform research, and that can be taught to black entrepreneurs in both HBCUs and non-HBCUs. Such models should undoubtedly explain the critical gap in what happens to the large portion of black nascent entrepreneurs whose ventures do not become established businesses. Studies like these might explore if these particular nascent entrepreneurs remain nascents indefinitely. Alternatively, they might explore if these nascents find refuge in the informal economy, revert to wagework or some other means to generate income, become serial nascent entrepreneurs, or endure some other circumstance such as establish their ventures elsewhere. A third critical area for future research is exploring if black entrepreneurs in the U.S. are more likely than other groups to operate partially or entirely in the informal economy. As previously explained, this facet of the economy is difficult to study. Although it would be ideal to directly measure the actual portion of black entrepreneurs in the informal economy, and then to determine how much of the gap in underrepresentation it accounts for, if any, it seems that measurement 170
can only be accomplished indirectly. New and unique measurement tools must be developed in order to accurately assess components of the informal economy. If this population segment is found to be more likely than others to operate in the informal economy, the segment should be analyzed to determine whether a substantial portion of these entrepreneurs convert fully into the formal economy or not. If we find that a sizeable portion would prefer to operate fully in the formal economy, research should then determine how best to go about such a conversion. Studies could then model which steps would aid these particular entrepreneurs into gaining sufficient knowledge and physical resources in order to effectively facilitate such a conversion. In a similar vein, future research could explore any opportunity costs that black entrepreneurs operating in the informal economy might endure. These studies could explore whether differences exist in the asset configurations of entrepreneurs operating in the informal versus formal economy. For example, research could determine if in fact operating in the formal economy provides better opportunities to work with lenders and build credit. These studies should also examine any other tradeoffs between operating in the two types of economies, as well as examine the degrees to which any opportunity costs of these tradeoff decisions remain hidden to these entrepreneurs. A fifth area of future research is to explore more deeply the impact of funding on the types of investigations that take place concerning black entrepreneurship, and at HBCUs. Only one of the papers published by an HBCU in this dataset indicated that it received funding. Nearly half (six) of the papers 171
published on black entrepreneurship in this dataset indicated that the study was funded. For only one of these studies (Robinson et al., 2005) was the sole purpose of the research to provide keener insight into the intricacies of black entrepreneurship. Future studies in this area might identify which steps could be taken to increase the funding available to finance critical research on improving successful black entrepreneurship in the U.S. The policy implications of the improving research on black entrepreneurship are enormous. If researchers can expand the body of knowledge, the benefits are many. We should expect a diminishing effect on the gap in the black-white entrepreneurship founding rates. We should also expect increased tax revenues through any increases in successful black business ownership, and therefore jobs. We should expect diminished unemployment, poverty, and therefore crime experienced in the black community, and elsewhere. And, finally, we should expect increases in wealth and standard of living among members of the black American population.
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10.0 REFERENCES
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Wellner, A. S. (2002). Capitalist dreams. American Demographics, 24(3); 36-41. Werbner, P. (2001). Metaphors of spatiality and networks in the plural city: A critiques of the ethnic conclave economy debate. Sociology, 35(3); 671693. Westhead, P., & Wright, M. (1998). Novice, portfolio, and serial founders: Are they different? Journal of Business Venturing, 13(3); 173-204. Williams, M. (2001). In whom we trust: Group membership as an effective context for trust development. The Academy of Management Review. 26(3); 377-396. Wilson, F., Marlino, D., & Kickul, J. (2004). Our entrepreneurial future: Examining the diverse attitudes and motivations of teens across gender and ethnic identity. Journal of Developmental Entrepreneurship, 9(3); p.177-197. Whaley A. L. (2001). Cultural mistrust and mental health services for African Americans: A review and metaanalysis. Counseling Psychology. 29(4); 513-531. Whaley, A. L., (2004). Ethnicity/race, paranoia, and hospitalization for mental health problems among men. American Journal of Public Health, 94(1); 78-82. White, S. B., & Reynolds, P. D. (1997). Factors inhibiting ethnic participation in the entrepreneurial process. Babson College, Frontiers of Entrepreneurship Research. Wilkinson, R. G. (1996). Unhealthy societies: The afflictions of inequality. Routledge, London. Winefield, A. H. (1995). Unemployment: Its psychological costs. In Cooper, C. L., & Robertson, I. T. (eds.), International Review of Industrial and Organizational Psychology. Volume 10, Chapter 5; 169–212, Wiley: London. Winefield, A. H. (2002). Unemployment, underemployment, occupational stress and psychological well-being. Australian Journal of Management, 27(Special Issue); 137-148. Wilbon, A. D. (2002). Predicting survival of high-technology initial public offering firms. Journal of High Technology Management Research, 13(1); 127141. 188
Wilson, F., D. Marlino & Kickul, J. (2004). Our entrepreneurial future: Examining the diverse attitudes and motivations of teens across gender and ethnic identity. Journal of Developmental Entrepreneurship, 9(3); 177197.
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APPENDIX A
SUMMARIES OF BLACK ENTREPRENEURSHIP PAPERS
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APPENDIX A
SUMMARIES OF BLACK ENTREPRENEURSHIP PAPERS
This section presents summaries of the 13 papers written on black entrepreneurship in the 29 outlets examined in this study. The summaries are in reverse chronological order, and they highlight information in each study that specifically relates to black entrepreneurship. Findings in papers on non-black groups that do not relate to black entrepreneurship are not reported in the summaries. Each of the 13 summaries begins with basic citation information on its corresponding paper.
Paper #1
Köllinger, P., and Minniti, M. (2006). Not for Lack of Trying: American Entrepreneurship in Black and White. in Small Business Economics, 27(1), p. 59-79.
Using Global Entrepreneurship Monitor (GEM) data collected on the U.S. population, Köllinger and Minniti (2006) found that blacks are significantly more likely than whites, Asians, and other minority groups in the United States to attempt to start a business. That is, black Americans have the highest levels of propensity to start a business relative to all other groups surveyed. Yet, blacks 191
are less likely than the other groups to succeed beyond the nascent entrepreneurship phase of venture development. That is, they are less likely to become established business owners. Controlling for socio-demographic differences fails to explain the gap in entrepreneurial propensity between blacks and whites. These researchers further found that controlling for the socio-demographic differences increases the black-white gap. Part of the gap is explained by individual perceptions, in that blacks are more self-confident, exhibit higher alertness to business opportunities, and are less sensitive to fear of failure. Köllinger and Minniti (2006) believed that their results suggest that perceptual differences explain the variance between black and white entrepreneurial propensity. Then, even after the researchers controlled for both socio-economic variables and perceptual variables, they found that blacks were still more likely than whites to start a business. However, they also found that perceptual variables and socio-economic variables among individuals do not explain much of the variance between black and white established entrepreneurs (i.e., owners of established businesses). Köllinger and Minniti (2006) believed this finding suggests that external constraints (i.e., not directly pertaining to the individual entrepreneur) explain the gap: External constraints such as discriminatory and restricted access to capital. Other findings include: •
Black entrepreneurs are statistically similar to whites in the various types of businesses they exploit. 192
•
Blacks are less educated than white and Asian Americans.
•
Blacks are more likely to have part-time only, versus full-time, employment.
•
Black entrepreneurs are more optimistic than all other groups concerning their likelihood of new venture success: believing they possess sufficient skills, knowledge, and experience to start a business.
•
Blacks are more likely than whites to know another entrepreneur, and to perceive business opportunities as “good”.
•
Whites are more likely than all other groups to be concerned with the possibility of failure. Whereas blacks are less likely than all other groups to be concerned with the possibility of business failure.
•
Finally, Köllinger and Minniti (2006) identify similar findings among United Kingdom respondents with respects to differences between white UK residents, and black UK residents of Caribbean and African descent. The black residents are more likely to attempt to start a business than white residents, and less likely to be established business owners.
Paper #2
Martin, W., Welch, B. A., Sandefur, J., and Pan, R. (2006). African American Small Business Owners’ Attitudes Toward Business Training. in Journal of Small Business Management, 44(4), p. 577-591.
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Martin et al. (2006) expanded on Hollingsworth and Hand’s (1976) research that found that black business people ranked lowest compared to whites and Cubans in perceiving a need for entrepreneurship training. Nearly two decades later, Martin et al. (2006) surveyed 421 black business owners, and 369 white business owners from one U.S. state and compared their responses on attitudes toward 23 areas of business training. The researchers reported that those businesses owned by the black respondents are significantly smaller than those owned by white respondents. These researchers also found that the black business owners’ attitudes have become substantially more positive towards training over the past twenty years. Using a seven-point scale with “7” representing the greatest importance, black business owners rated the importance of training in all 23 areas as significantly more important (at the .001 level) than whites. Both groups also ranked the 23 areas from most important to least important. For the most part, both groups ranked the areas similarly. Notable differences include blacks assigning accounts receivable management a lower ranking of 9, compared to whites who assigned this training a higher ranking of 5. Black business owners also ranked training in: loan application, and managing technology lower than white business owners. Blacks ranked training in: strategic planning, obtaining business licenses, advertising, and government procurement higher than whites. When Martin et al. (2006) paired respondents in their sample to control for business age, type, size (number of full-time employees), and owner/respondent 194
age, the sample size reduced from 790 to 298 respondents, with 149 black respondents, and 149 white respondents. Again, both groups ranked the importance of each of the 23 areas of training similarly. Notable differences include blacks assigning a higher ranking of “4” to strategic planning than whites who assigned this area a ranking of “10.” Blacks assigned loan application the second to the least important rank (22), whereas whites assigned loan application a much higher ranking of “12.” Blacks again assigned accounts receivable management a much lower ranking (10) than whites (4). And, blacks also assigned sales (11 versus 6), and managing technology (20 versus 14) much lower rankings than whites.
Paper #3
Brush, C., Monti, D., Gannon, A., and Ryan, A. (2006). Inner City Entrepreneurs: Building Ventures and Expanding Community Ties. in Babson College, Frontiers of Entrepreneurship Research.
Brush et al. (2006) examined 29 black, Hispanic, and white inner city entrepreneurs in Boston, Massachusetts. Brush and her colleagues found differences between the minority group (black and Hispanic) and the non-minority group (white). Black and Hispanic entrepreneurs are more likely to be running their first venture, while white entrepreneurs are more likely to be running a business that constitutes their second through eighth startup. Fourty percent of 195
blacks are running a business other than their first startup, and 77 percent of whites are running a business other than their first startup. Black and Hispanic entrepreneurs more actively participate in community events than white entrepreneurs, and they are more deeply involved with their ethnic communities. They also more often market their products to fellow members of their racial/ethnic groups. Finally, all of Brush et al.’s (2006) black respondents believed that their professional goals are best met through business ownership as opposed to through employment through working for others. In comparison, only 69 percent of white entrepreneurs believe entrepreneurship to be the ideal venue to achieve their professional goals.
Paper #4
Fairlie, R. W. (2005). Entrepreneurship and Earnings among Young Adults from Disadvantaged Families. in Small Business Economics, 25(3), p. 223-236.
Fairlie (2005) analyzed National Longitudinal Survey of Youth data on 11,406 young men and women who were ages 14 to 22 years when they were first interviewed in 1979. He measured their earnings throughout the subsequent 19 years to 1998. Included in his sample is a group of 5,295 economically disadvantaged black, Hispanic, and non-black, non-Hispanic youth. Fairlie (2005) operationalizes economically disadvantaged as those persons whose 196
parents have less than a high school education. Overall, Fairlie’s (2005) findings show that men from disadvantaged families earn more through self-employment than their waged/salaried male counterparts, while women from disadvantaged families earn less through self-employment than their waged/salaried female counterparts. His findings also show that in general, the self-employed (men and women) earn more than waged/salaried workers. Fairlie’s (2005) regression results show separate earnings regression estimates, controlled for current earnings status, age, race, education, and other demographic characteristics. Although the results specific to blacks are not discussed in Fairlie’s (2005) article, they show that black men and women, both self-employed and non-selfemployed, earn less than white and Hispanic men and women.
Paper #5
Robinson, J., Blockson, L., and Robinson, S. (2005). African American Women Entrepreneurs and Firm Growth: New Theoretical Directions at the Intersection of Race, Gender, and Firm Growth. in Babson College, Frontiers of Entrepreneurship Research
Robinson, Blockson, and Robinson (2005) conducted qualitative focus group, and individual, interviews on 62 black women entrepreneurs who reside within seven U.S. metropolitan areas. At the time of the research, each of these women was an owner/manager, had a minimum of 3 years of owner/management experience, and was either the sole owner, or had only one 197
other owner partner who was also a black woman. Robinson et al. (2005) uncovered four themes that shape the black female entrepreneurship experience. The four themes are: double-minority challenge, passion versus growth tradeoff, significance of family history and family support, and calling and community orientations. These are discussed below:
Double-minority challenge First, black women entrepreneurs perceive themselves being confronted by a double-minority challenge in that they are both black and female. As a result, during times that their credibility is threatened, their social identity is forced to fluctuate as to which minority status comes first. The fluctuation varies based on in whichever context they find themselves. Many of these women chose not to compete for government and set-aside contracts in order to avoid negative stigmatizations of inferiority and neediness that they believe are highly associated with labels of “minority-owned” or “woman-owned” enterprises.
Passion versus Growth tradeoff Black women entrepreneurs do not measure business success merely in economic or financial terms. Instead, they relate more so to a venture being able to provide two or more of the following as measures of business success: wealth for families; increased time to spend with family; ability to give back to community; ability to meet specific customer needs; and ability to fulfill a personal or spiritual calling. Nearly half of black women who are established business 198
owners want to grow their business into a larger venture, which they identify as a measure of business success. The remainder prefers to maintain their current size: an ability of which they likewise view as a measure of business success. The majority of these women identify as key, their ventures not compromising their founding values.
Significance of family history and family support Some black women entrepreneurs are inspired by parents or extended family members who are/were entrepreneurs or who are/were entrepreneurial in that they possess(ed) an entrepreneurial spirit or a spirit of economic selfdetermination. Some black women entrepreneurs also view as a measure of business success the ability to maintain such entrepreneurial family traditions. The average age of Robinson et al.’s (2005) sample was 49, with half being mothers. The researchers reveal how many of these women managed conflicting demands of family and business. In response to the oft-times conflicting obligations, a large number of the AAWEs [African American Women Entrepreneurs] parlayed their professional experiences and resources in a manner that enabled them to conduct business on their terms while continuing to meet their family’s needs. (p. 13) These women identified as another measure of business success, the ability to manage these conflicting demands.
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Calling and community orientations The final theme that Robinson et al. (2005) identified is calling and community orientations. Most of these women expressed as a strong measure of business success the ability to fulfill a responsibility to their local black community in the form of employment and economic support. In fact, some expend effort to hire a significant number of high school dropouts, former felons, and public assistance recipients in order to provide opportunities for improvement among their at-risk community members. Others hire local community members as a means to influence and mentor junior members toward optimal levels of professional and economic achievment. Finally, the overwhelming majority of these women believe that their circumstance as business owners was prompted by their heeding to a higher, spiritual calling. Thus, the final measure of business success for these women is a venture’s ability to manifest “God’s” purpose for its existence.
Paper #6
Fairlie, R. W. (2004). Recent Trends in Ethnic and Racial Business Ownership. in Small Business Economics, 23(3), p. 203-218.
Fairlie (2004) surveyed Current Population Survey (CPS) micro-data from 1979 to 1998 and uncovered certain trends differentiating black entrepreneurs from white, Asian, Hispanic, and Native American entrepreneurs. Fairlie (2004) 200
found that blacks are the least likely of all groups to own businesses (one third as likely as whites), followed by Hispanics (one half as likely as whites), and then Native Americans. Whites and Asians have the highest rates of business ownership. Specifically, the rate of self-employment for black men is 5.1 percent, which equates to 39 percent of the rate for white men (13.1 percent). The selfemployment rate of black women is 2.7 percent, equating to 36 percent of the rate for white women (7.5 percent). Fairlie (2004) writes that perhaps his most striking find is that the rankings of self-employment rates across the groups have remained stable over the past two decades. Similarly, Fairlie and Meyers (2000) found that the black male to white male business ownership percentage ratio (one-to-three) has remained constant since 1910. Fairlie (2004) also found that although the absolute number of black business owners increased (83 percent) over the nearly 20 year period relative to all other groups with the exception of Hispanic business owners (193 percent), that such increases do not provide evidence of an improving business ownership condition for blacks. Fairlie (2004) shows that similar to Asians, Hispanics, and Native Americans, the increases in business ownership for blacks primarily result from increases in their labor force participation, and not from increases in their propensity to choose self-employment. That is, ownership increased consistent with growth of the labor market, and not in overall percentage of black population. Black women were the exception in Fairlie’s (2004) study whereby their rapid increases in self-employment throughout the 1980s were not primarily
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due to their expansion in the labor force. This finding suggests an increase in entrepreneurial propensity among black women, at least throughout the 1980s. Fairlie (2004) believes that his overall findings support the idea that one method to increase the number of black and other minority-owned businesses is to implement broad policies to increase their labor force participation. His overall findings include the following: Increases in education and age, and becoming married, are associated with increases in entrepreneurship. Increased levels of education among black men relative to white men contributed to a slight narrowing of the white/black self-employment rate gap from 1979-81 to 1996-98 (a 0.414 percent decrease in the gap). Yet, the black workforce, along with those of all other minority groups’, aged less rapidly than the white workforce, thereby reducing the self-employment rate of blacks relative to whites. Finally, Fairlie (2004) found that the average age of the workforce comprised of black women increased less rapidly than that comprised of white women, and that black women were less likely to be married. These phenomena contributed to an increase in the black/white entrepreneurship gap (an increase of 1.468 percent to the gap), thereby offsetting any gains created by black men. And, Fairlie (2004) shows that although Asians comprised a much smaller portion of the U.S. population than blacks, in 1998 they owned nearly as many businesses as blacks. This finding supports that Asians have a higher propensity toward self-employment than blacks.
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Paper #7
Reynolds, P. D., Carter, N.M., Gartner, W.B., and Greene, P. G. (2004). The Prevalence of Nascent Entrepreneurs in the United States: Evidence from the Panel Study of Entrepreneurial Dynamics. in Small Business Economics, 23(4), p. 263-284.
Reynolds, Carter, Gartner, and Greene (2004) analyzed longitudinal PSED data on 64,622 households, and compared Asian, black, and white nascent entrepreneurs. They found that of approximately 10.1 million adults living in the U.S. who are attempting to start businesses, blacks account for 1.8 million, whites account for 7.7 million, and Hispanics account for 1.1 million.9 Black adults (ages 18 to 64 years) are 50 percent more likely than white adults to attempt to start a business.
The researchers’ findings also address how the
rate of black nascent entrepreneurship relates to (or is impacted by) the following variables: education, household income, dwelling ownership, labor force participation, marital status, and urban context. The findings concerning these variables are presented next. Increased education has a stronger positive effect on nascent entrepreneurship participation among black adults compared to white adults. Black men and women who report any graduate training are two to three times more likely than white men and women to attempt to start a business. Black (and
9
Reynolds et al. (2004) explain that the aggregate number of people who are attempting to start businesses (10.1 million) is less than the sum total number of people segmented by race because of “differences between official U.S. census data on Hispanics, which includes those who identify with other races.” (p. 272).
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Hispanic) men with graduate experience are at least twice as likely as white men with graduate experience to attempt to start a business. Similar to education, increased household income has a stronger positive effect on nascent entrepreneurship participation among black adults compared to white adults. The effect of household income on entrepreneurship participation for black men and women is similar to that for Hispanic men and women. Black men are the only group for which owning one’s place of dwelling (as in a home, apartment, or condominium) both positively and significantly relates to their becoming a nascent entrepreneur. The researchers point out, however, that the causality is not clear. That is, whether dwelling ownership impacts nascent entrepreneurship participation, or if nascent entrepreneurship participation leads to home ownership has not been determined. Blacks are similar to all other groups in that those involved in the U.S. labor force, that is those with full or part time jobs, are more likely to be nascent entrepreneurs than those not in the workforce. Examples of those not in the workforce include housewives, retirees, the unemployed, and students. Of all ethnic groups, black women are the only group for which being married positively and significantly increases the likelihood of being a nascent entrepreneur. The relationship between urban residence and nascent entrepreneurship prevalence is greatest for black men and women than all other groups10. While the relationship is also positive for white men and women, it is less so than for
10
Reynolds et al. (2004) do not discuss this statement as one of their findings. However, the Table 10 indexes in the “Above average quartile” and “Highest quartile” substantiate the statement.
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blacks. For Hispanic men and women, the relationship is reversed, whereby more nascent entrepreneurship occurs among those residing in the least urban contexts relative to the greatest. Reynolds et al. (2004) segmented their respondents into four groups of equal size quartiles. The quartiles were computed according to what the researchers referred to as “urbanness” (p. 279). In the lowest quartile, white men and white women had nascent entrepreneurship prevalence rates of 6.1 percent and 3.2 percent, respectively. In the highest quartile, these rates increased to 8.5 percent and 4.8 percent. In contrast, in the lowest quartile, black men and black women had nascent entrepreneurship prevalence rates of 9.5 percent and 4.5. percent, respectively. But, in the highest quartile, the numbers increased much higher to 12.4 percent and 9.1 percent. The increase for white men and women equals 2.4 percent for white men, and 1.6 percent for white women. For black men, the increase is 2.9 percent, and for black women the increase is 4.6 percent.
Paper #8
Crosa, B., Aldrich, H. E., and Keister, L. A. (2002). Is There a Wealth Affect? Financial and Human Capital as Determinants of Business Startups. in Babson College, Frontiers of Entrepreneurship Research
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Crosa, Aldrich, and Keister (2002) also examined PSED data and derived several findings, many of which do not relate only to black entrepreneurs, but instead to entrepreneurs in general. However, since their findings were derived from a researched group that includes black nascent entrepreneurs, the findings nonetheless provide knowledge on black entrepreneurship. These researchers found that any effect of income and net worth in spurring nascent entrepreneurship activity is nullified once human capital, gender, and ethnicity are controlled. The researchers treat education, age, having self-employed parents, and current self-employment status as measures of human capital. Crosa and colleagues (2002) maintain that the importance of financial assets may be overstated in the entrepreneurship literature. They explain that often entrepreneurs who lack ideal levels of startup capital continue in entrepreneurship in spite of their undercapitalization. These undercapitalized entrepreneurs rely on innovative measures to generate necessary startup capital. The researchers argue for the use of a contingency view of startup capital, where the importance of levels of capital varies based on type of industry. They believe such an approach to be more appropriate than generalizing the importance of financial capital to entrepreneurs in all fields or industries. Similarly, Crosa et al. (2002) found that the initial strong effect of income and net worth on constraining nascent entrepreneurship of blacks and Hispanics relative to whites is much weaker after controlling for human capital and education. Crosa et al. (2002) also found: 1) that education positively relates to people becoming nascent entrepreneurs, especially when they have a high 206
school degree or less compared to any other education level beyond high school graduation; and, 2) that a curvilinear relationship exists between age and nascent entrepreneurship, where after reaching a certain age, the relationship becomes negative.
Paper #9
Galbraith, C. S., and Stiles, C. (1999). Entrepreneurial Behavior of Freed Slaves: Post Civil War Southern States. in Babson College, Frontiers of Entrepreneurship Research
Galbraith and Stiles (1999) analyzed the body of work known as the “Slave Narratives” where interviews of an aging population of ex-slaves are narrated, documenting their memories of both their slave and post-slave lives. They found that many slaves acquired critical artisan and productive skills that, once freed, few attempted to exploit entrepreneurially. Instead, the researchers found that the majority of these freed and skilled slaves entered into sharecropping, which the researchers refer to as small-scale, capital-deprived, joint ventures. Finally, the researchers found that a few of the freed slaves attempted supplementary entrepreneurial activity, or primary income entrepreneurship in artisan based fields such as blacksmithing, or in agricultural fields such as small plot farming. The target market for nearly all of these
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ventures was the freed slaves’ more highly capitalized venture partners, the landowners.
Paper #10
Walstad, W. B., and Kourilsky, M. L. (1998). Entrepreneurial Attitudes and Knowledge of Black Youth. in Entrepreneurship Theory and Practice, 23(2), p. 5-18.
Walstad and Kourilsky (1998) measured a U.S. national sample of 842 youth (129 black and 713 white) and found that black youth are substantially more interested in pursuing entrepreneurship than white youth. Three-fourths of black youth are interested in pursuing entrepreneurship, compared to 63 percent of white youth. Additionally, black youth more strongly than white youth believe that entrepreneurship allows people to: be their own boss, build something for family, earn significant money, use one’s skills and abilities, and overcome challenges. However, black youth believe that non-monetary reasons for starting one’s business are equally as important as monetary reasons. More black youth (84 percent) than white youth (75 percent) believe that teaching entrepreneurship in U.S. schools is vital to successful entrepreneurship. Black youth also believe more so than white youth that it is very important that successful entrepreneurs and business people give something back to the community more than just providing jobs (80 percent versus 61 percent).
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Black youth are less likely than white youth to know an entrepreneur. And among the black youth who do know an entrepreneur(s), the entrepreneur is less likely to be a parent. Although black and white youth equally believe that their training in business and entrepreneurship is inadequate, and although both groups score equally low on basic knowledge regarding business and entrepreneurship, blacks are less critical of, and more optimistic in, their selfassessments on their knowledge and understanding in this area. A third of black youth rate their knowledge and understanding as either excellent or good, compared to only 13 percent of white youth. And, only 17 percent of black youth consider their knowledge and understanding as either poor or very poor, compared to nearly half of white youth.
Paper #11
Young, N. (1998). The Structure and Substance of African American Entrepreneurial Networks: Some Preliminary Findings. in Babson College, Frontiers of Entrepreneurship Research
Young (1998) looked at a probability sample of 30 black owner-manager entrepreneurs whose firms were five years old or younger and found that many black entrepreneurs do not configure their networks to include large and diverse affiliations. Instead, he found that they assemble a small core of strong ties who aid them both in acquiring entrepreneurial resources, and in making important 209
social and economic decisions. Young (1998) analyzed two separate dimensions of black entrepreneurs’ networks: resource acquisition, and social support. In terms of resource acquisition, his findings include that black entrepreneurs compose their entrepreneurial resource networks mainly of other blacks (81.7%), other entrepreneurs (39.8%), friends (44.8%), especially close individuals (40.1%), and individuals they speak with on a daily basis (50.1%). In terms of social support, black entrepreneurs similarly compose their networks mainly of other blacks (93.6%), other entrepreneurs (19.3%), friends (66.6%), emotionally close individuals (75.0%), and individuals they speak with daily (52.8%). Young also found that black entrepreneurs use their networks considerably to receive information and acquisition assistance on: financial capital, location, information technology, and other entrepreneurial resources. Blacks use their social networks considerably for advice about major life changes, borrowing money, and improving their businesses. Young (1998) encourages black entrepreneurs to increase the sizes and diversity structures of their networks in order to increase the amount of beneficial information available to them. As a consequence, he suggests, black entrepreneurs will have increased access to more highly resourced contacts who may provide social and resource acquisition support. Finally, Young (1998) emphasizes that “recognizing who these contacts are and the contribution each can make to improving one’s success in the entrepreneurial arena” is key to effectively using one’s network. 210
Paper #12
White, S. B., and Reynolds, P. D. (1997). Factors Inhibiting Ethnic Participation in the Entrepreneurial Process. in Babson College, Frontiers of Entrepreneurship Research
As somewhat of a precursor to the Panel Study of Entrepreneurial Dynamics (PSED) dataset, White and Reynolds (1997) longitudinally measured a random sample of five different ethnic populations in Wisconsin to determine if various ethnic characteristics lead to differences in participation in the entrepreneurship process. The researchers were particularly interested in identifying whether any differences between the groups inhibited participation in entrepreneurship throughout the various stages of the entrepreneurship process: for example, the business creation process (or nascent entrepreneurship stage). Although, White and Reynolds (1997) found no differences among the five ethnic groups, as this section illustrates, subsequent studies show that when the sample is extended throughout the entire U.S. (as in the PSED, and GEM), differences are observed.
Paper #13
Portes, A., and Zhou, M. (1996). Self-employment and the Earnings of Immigrants. in American Sociological Review, 61(2), p. 219-230.
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Using 1980 Public Use Microdata Sample data from the U.S. Census on Cuban, Chinese, Japanese, and Korean men, and using random sample data on black and white men, Portes and Zhou (1996) showed that the self-employed of all of these men have more years of work experience, and that they work more hours than their salaried counterparts. They also showed that the self-employed earn more than their salaried counterparts. However, black men are unique in that they are the only members of the sample whose gains were not significant. Black men are also unique in that less than half of those whose earnings make them positive outliers are self-employed. For the other groups, more than half of the men who are positive outliers in terms of earnings are self-employed. Although Portes and Zhou (1996) did find differences between the earnings of black entrepreneurs as compared to white, Cuban, Chinese, Japanese, and Korean entrepreneurs, the main focus of their research was to show how researcher choice of statistical method will lead to entirely different findings as far as earnings and self-employment are concerned. The statistical choice they analyzed is computing the dependent variable earnings as a linear (absolute dollar values) versus a loglinear (relative returns) form. When Portes and Zhou (1996) transformed their data to compute a loglinear form of earnings in order to minimize the effects of positive outliers, the data achieved a higher fit to normality. Yet, the researchers showed that improved fit comes at a critical cost: the obscuring of key information that explains how entrepreneurship does in fact produce a disproportionate number of very high earners. Hence, when the researchers repeated their analyses using 212
the transformed earnings data, the effect of self-employment became negative for black, white, and Japanese men. Of the entire sample population, Japanese and white men occupied the upper extreme of earnings distribution, and black men occupied the lower extreme.
Summary The findings presented and summarized in this section comprise the body of knowledge that exists on black entrepreneurship in the major entrepreneurship publication outlets. This body of knowledge relates to five overarching areas: 1) rates of black entrepreneurship participation; 2) factors that facilitate or impede increases to black entrepreneurship rates; 3) characteristics of established business owner entrepreneurs; 4) outcomes derived by black entrepreneurs, and by their ventures; and 5) post-slavery era entrepreneurship . The overwhelming majority of these studies compare key attributes of black entrepreneurship to those of white entrepreneurship, and to a lesser extent, Asian entrepreneurship.
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APPENDIX B
Rankings of Top 100 Authors by Total Weighted Papers Published on Entrepreneurship in General
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APPENDIX B Rankings of Top 100 Authors by Total Weighted Papers
Rank
Total Wtd Papers
1
16.97
2
14.25
Scott A. Shane Dean A. Shepherd
3
12.80
Shakar A. Zahra
4
11.42
5
10.68
Paul Westhead James J. Chrisman
6
9.88
Mike Wright
7
8.58
David B. Audretsch
8
8.50
James O. Fiet
9
8.00
Timothy Bates
10
7.75
Peter J. Rosa
11
7.70
Mark S. Freel
12
7.65
13
7.33
Per Davidson Howard E. Van Auken
14
7.00
15
6.81
16
6.75
17
6.71
18
6.48
19
6.38
20
6.33
Author
Robert C. Cressy Lowell W. Busenitz Richard G. P. McMahon Erkko Autio Andrew L. Zacharakis Steven C. Michael Harry J. Sapienza
Affiliation Case Western Reserve University Indiana University University of Minnesota University of Nottingham Mississippi State University University of Nottingham Max Planck Institute of Economics & Indiana University University of Louisville Wayne State University University of Edinburgh University of Ottawa Queensland Univ. of Technology Iowa State University CASS Business School University of Oklahoma Flinders University of South Australia Helsinki University of Technology Babson College University of Illinois at UrbanaChampaign University of Minnesota
215
Affln Country US
Total UnWtd Papers
UnWtd Papers Rank
25.6 28.6
4
US
2
US
27.4
3
UK
25.4
5
US
22.5
6
UK
32.3
1
Germany US
13.2
18
US
14.4
12
US
8.0
48 tied
UK
14.6
11
Canada
8.2
46
Australia
16.6
10
US
7.6
56
UK
8.0
48 tied
US
17.0
8
Australia
8.0
48 tied
Finland
13.7
15
US
13.3
17
US
7.5
57 tied
US
18.1
7
Rank
Total Wtd Papers
21
5.97
Robert A. Baron
22
5.94
Colin M. Mason
23 25 tied 25 tied
5.93
Marc Cowling
5.89 5.89
Sue Birley William B. Gartner
26
5.77
Benson Honig
27 28
5.70 5.50
Gavin C. Reid Justin Tan
29
5.48
A. Roy Thurik
30 32 tied
5.35
Monder Ram
5.33
Stephen Roper
5.33
5.11
Johan Wiklund Richard T. Harrison Candida G. Brush
5.11
Lars Kolvereid
36 37 tied 37 tied
5.01
Lloyd P. Steier
5.00
Roger J. Bennett
5.00
Albert N. Link
39
4.95
Garry D. Bruton
40
4.90
Sara Carter
42 tied
4.84
Pierre-Andre Julien
32 tied 33 34 tied 34 tied
5.18
Author
Affiliation Rensselaer Polytechnic Institute University of Strathclyde University of Sussex Imperial College of Sci. Tech. & Med. Clemson University Wilfrid Laurier University University of St Andrews York University Erasmus University Rotterdam & Max Planck Institute of Economics De Montfort University Queen's University of Belfast Jönköping International Business School Queen's University of Belfast Boston University Bodo Graduate School of Business, Norway University of Alberta University of Cambridge University of North Carolina Texas Christian University University of Strathclyde Université du Québec à TroisRivières
216
Affln Country
Total UnWtd Papers
UnWtd Papers Rank
US
9.7
31
Scotland
12.8
19
UK
9.3
36 tied
UK
10.4
26
US
14.3
13
Canada
8.3
43 tied
UK Canada
7.4 6.0
59 tied 79 tied
Netherlands Germany
16.9
9
UK
10.3
27 tied
Ireland
7.0
67 tied
Sweden
9.5
33 tied
UK
10.9
24
US
13.6
16
Norway
8.3
43 tied
Canada
9.3
36 tied
UK
7.0
67 tied
US
7.0
67 tied
US
12.3
20
UK
8.5
42
Canada
10.3
27 tied
Rank 43 tied 43 tied 45 tied 45 tied
Total Wtd Papers
Author
Affiliation University of Texas at Dallas University of Westminster
Affln Country
Total UnWtd Papers
UnWtd Papers Rank
US
10.6
25
UK
10.1
29
4.80
David L. Deeds
4.80
John Stanworth
4.51
Indiana University NFIB Education Foundation Utah State University
US
11.5
22 tied
US
7.0
67 tied
US
9.6
32
Indiana University
US
12.2
21
Babson College University of Durham Brock University
US
7.5
57 tied
UK Canada
5.6 9.2
87 38 tied
US
7.4
59 tied
UK
6.4
74 tied
US
8.8
40
US
6.0
79 tied
Germany
4.0
102 tied
US
9.9
30
Hong Kong
5.3
91
UK
7.2
63
US
5.1
92
UK
6.0
79 tied
UK
6.0
79 tied
US
9.2
38 tied
US
9.5
33 tied
Australia
5.4
90
47
4.38
48 49 tied 49 tied 51
4.34
Jeffrey G. Covin William J. Dennis, Jr. Gaylen N. Chandler Donald F. Kuratko
4.28
Maria Minniti
4.28 4.17
52
4.14
53 54 tied 54 tied 54 tied
4.05
Simon C. Parker Dirk de Clercq Patricia G. Greene Alistair R. Anderson
4.00
Zoltan J. Acs
4.00
Bo Carlsson
4.00
Joachim Wagner
57
3.99
G. Dale Meyer
58
3.98
Wai-sum Siu
59
3.89
60 61 tied 61 tied
3.88
Julian Birkinshaw Rita Gunther McGrath Christos Kalantaridis Alan D. MacPherson
63
3.79
64
3.69
Paul D. Reynolds G. Thomas Lumpkin
65
3.61
John Watson
4.51
3.83 3.83
Babson College Robert Gordon University University of Baltimore Case Western Reserve University University of Luneburg University of Colorado at Denver Hong Kong Baptist University, London Business School Columbia University University of Teesside Sheffield University Florida International University University of Illinois at Chicago University of Western Australia
217
Rank 67 tied 67 tied 73 tied 73 tied 73 tied 73 tied 73 tied 73 tied
Total Wtd Papers
Author Eileen Fischer
3.52
3.50
A. Rebecca Reuber Maryann P. Feldman
3.50
Michael Fritsch
3.50
Peter Johnson Patrick J. Kaufmann David Smallbone
3.52
3.50 3.50 3.50
Olav R. Spilling
75 76 tied 76 tied
3.49
Daniel P. Forbes
3.47 3.47
Deniz Ucbasaran Sankaran Venkataraman
78 79 tied 79 tied
3.41
Gavin Cassar
3.39
Robert D. Hisrich
3.39
81 82
3.38 3.37
Jerome A. Katz Dylan JonesEvans Rajiv P. Dant
83
3.36
84 86 tied 86 tied
3.34
Jianwen Liao Saras D. Sarasvathy
3.33
Steven Casper
3.33
Hans Landstrom
87
3.32
Gregory G. Dess
88
3.30
Attahir Yusuf
89
3.28
Vance H. Fried
90
3.27
Moren Levesque
Affiliation York University University of Toronto Johns Hopkins University Technical University University of Durham Boston University Middlesex University Norwegian School of Management University of Minnesota University of Nottingham University of Virginia University of Pennsylvania Thunderbird University Saint Louis University University of Wales Bangor Boston University Northeastern Illinois University University of Virginia Cambridge University Lund University University of Texas at Dallas University of Sharjah Oklahoma State University Case Western Reserve University
218
Affln Country
Total UnWtd Papers
UnWtd Papers Rank
Canada
7.8
53 tied
Canada
7.8
53 tied
US
5.0
93 tied
Germany
5.0
93 tied
UK
6.0
79 tied
US
6.0
79 tied
UK
8.7
41
Norway
4.0
102 tied
US
4.5
97
UK
14.0
14
US
7.1
64 tied
US
4.6
96
US
9.4
35
US
6.4
74 tied
UK US
5.5 6.1
88 tied 77 tied
US
7.3
62
US
3.7
107
UK
5.0
93 tied
Sweden
6.8
72 tied
US United Arab Emirates
8.3
43 tied
4.3
100 tied
US
7.1
64 tied
US
6.2
76
Rank
Total Wtd Papers
93 95 tied 95 tied
3.06
Author Pramodita Sharma Walter Kuemmerle Bengt Johannisson
3.06
Robert N. Lussier
96
3.05
Martin T. Robson
97
3.03
Ian Chaston
98 100 tied 100 tied 100 tied 100 tied 100 tied 100 tied 100 tied
3.02 3.00
Allan L. Riding Gary J. Castrogiovanni
3.00
Allan A. Gibb
3.00
Jeroen Hinloopen
3.00
Dan Johansson
3.00 3.00
Anne Marie Knott Norris F. Krueger, Jr.
3.00
Miri Lerner
100 tied
3.00
Sumit K. Majumdar
100 tied
3.00
>100
2.65
Kishor C. Samal Howard E. Aldrich
>100 >100
2.56 2.45
Nancy M. Carter Timothy B. Folta
>100
2.35
Michael Frese
>100
1.93
Alexander Ardichvili
92
3.12 3.10
Affiliation Wilfrid Laurier University Harvard University Vaxjo University
Affln Country Canada
Total UnWtd Papers
UnWtd Papers Rank
8.1 3.1
47
US
108 tied
Sweden
4.4
98 tied
US
5.7
86
UK
3.1
108 tied
Springfield College University of Durham University of Plymouth University of Ottawa
UK
8.0
48 tied
Canada
7.9
52
University of Tulsa
US
6.0
79 tied
Durham University University of Amsterdam
UK
4.0
102 tied
Netherlands
3.0
110 tied
Sweden
4.0
102 tied
US
4.0
102 tied
US
4.4
98 tied
Israel
6.8
72 tied
UK
3.0
110 tied
India
3.0
110 tied
US
6.9
71
US US
7.7 6.1
55 77 tied
Germany
7.1
64 tied
US
4.3
100 tied
Ratio Institute Washington University Bosie State University Tel Aviv University Imperial College of Science, Technology and Medicine Nabakrushna Chaodhury Centre for Development Studies University of North Carolina University of St. Thomas & Catalyst, Inc. Purdue University University of Giessen University of Illinois at UrbanaChampaign
219
APPENDIX C
Rankings of Top 100 Affiliations by Total Weighted Papers Published on Entrepreneurship in General
220
APPENDIX C Rankings of Top 100 Affiliations by Total Weighted Papers
Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39
Total Wtd Papers 43.711 34.830 29.930 22.500 22.109 22.010 21.265 20.625 19.175 18.977 17.452 17.338 16.267 15.753 15.726 15.359 15.282 15.199 14.667 14.257 14.214 14.002 13.992 13.668 13.320 13.291 13.046 13.009 12.719 12.570 12.213 11.835 11.455 11.445 11.217
11.210 10.888 10.850 10.664
Affiliation Harvard University University of Nottingham University of Warwick Renssalaer Polytechnic Institute Georgia State University Indian Institute of Management University of Colorado at Boulder Babson College Jonkoping University Indiana University, Bloomington Erasmus University University of Maryland Case Western Reserve University Boston University University of Calgary National University of Singapore University of Minnesota, Minneapolis University of Pennsylvania Manchester Metropolitan University Stockholm University University of Alberta Ohio State University Georgia Institute of Technology University of Amsterdam Iowa State University University of Cambridge University of Aberdeen London Business School University of Strathclyde Imperial College London Nanyang Technological University Baylor University University of Stirling Bocconi University Newcastle University University of Quebec, Three Rivers University of South Carolina Durham University Free university
221
Country US UK UK US US India US US Sweden US Netherlands US US US Canada Singapore US US UK Sweden Canada US US Netherlands US UK Scotland UK Scotland UK Singapore US Scotland Italy UK Canada US UK Netherlands
Total UnWtd Papers 55.3 55.2 45.5 42.5 44.8 21.1 49.5 47.2 31.0 34.6 32.7 28.1 35.9 25.8 22.0 20.6
UnWtd Papers Rank 1 2 5 7 6 25 3 4 11 9 10 14 8 18 24 28
28.6 25.5 18.4 26.6 22.7 27.1 27.9 19.3 18.9 18.5 20.0 30.3 22.5 19.3 15.7 18.3 18.7 16.4 14.6
13 19 38 17 20 16 15 31 tied 33 tied 36 tied 30 12 21 31 tied 51 tied 39 tied 35 49 58 59 22 70 48
14.5 22.4 12.7 16.5
Rank 40 41 42 43 44 45
Total Wtd Papers 10.628 10.584 10.578 10.515 10.505 10.413
46 47 48 49
10.347 10.043 10.017 9.791
50 51 52 53
9.750 9.597 9.513 9.437
54 55 56 57 58 59
9.305 9.238 9.187 9.160 9.023 8.865 8.803
60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79
8.613 8.517 8.456 8.359 8.324 8.318 8.173 8.167 8.104 7.955 7.950 7.916 7.817 7.797 7.492 7.490 7.447 7.407 7.325
Affiliation Stanford University University of Central Florida University of Toronto University of Durham Helsinki University of Technology University of Edinburgh University of California Las Angeles University of Michigan, Ann Arbor Utah Slate University York University Flinders University of South Australia Chinese University of Hong Kong Wayne State University EIM Business & Policy Research Massachusetts Institute of Technology Rutgers University Columbia University Kingston University Middlesex University University of Western Australia University of Illinois at Urbana– Champaign University of Wisconsin at Madison New York University University of Alabama Wilfrid Laurier University University of Southern California Chalmers University of Technology University of British Columbia Mississippi State University University of Jyväskylä University of Western Ontario University of Paris Ghent University Temple University San Diego State University Brigham Young University Politecnico di Milano California State University University of Manchester Cornell University
222
Country US US Canada UK Finland UK
Total UnWtd Papers 17.8 20.7 18.9 12.3 20.1 17.4
UnWtd Papers Rank 42 27 33 tied 74 29 43 tied
US US US Canada
14.3 15.7 20.9 18.5
60 51 tied 26 36 tied
Australia Hong Kong US Netherlands
10.0 17.4 11.2 22.1
91 tied 43 tied 80 tied 23
US US US UK UK Australia
15.0 16.7 13.2 14.0 16.3 11.5 15.1
56 47 66 tied 63 50 79
US US US US Canada US Sweden Canada. US Finland Canada France Belgium US US US Italy US UK US
18.0 14.2 11.1 13.8 18.3 11.9 13.2 17.0 10.4 14.1 12.1 17.1 15.1 8.6 10.4 8.0 12.6 11.0 11.1
54 tied 41 61 82 tied 64 39 tied 77 66 tied 46 88 tied 62 75 tied 45 54 tied 96 88 tied 99 71 86 82 tied
Rank 80 81 82
Total Wtd Papers 7.196 7.193 7.083
83 84 85 86 87 88
6.983 6.970 6.962 6.867 6.852 6.708
Affiliation University of Reading University of Ulster Copenhagen Business School University of North Carolina at Chapel Hill Tel Aviv University University of Oklahoma University of California at Berkeley University of Sussex University of Washington at Seattle
89 90 91 92 93 94 95 96 97 98 99 100
6.687 6.686 6.667 6.603 6.578 6.510 6.338 6.275 6.250 6.210 6.130 6.123
University of Canterbury University of Houston University of Ottawa Carleton University De Montfort University University of Texas at Arlington Ball State University Tilburg University Northwestern University Michigan State University Clemson Univeristy University of Birmingham
223
Country UK Ireland Denmark US Israel US US UK US New Zealand US Canada Canada UK US US Netherlands US US US UK
Total UnWtd Papers 9.6 12.5 8.1
UnWtd Papers Rank 93 tied 72 97 tied
15.4 13.0 14.8 9.6 11.1 12.9
53 68 57 93 tied 82 tied 69
11.1 13.6 7.0 9.3 10.6 12.1 11.2 8.1 10.0 11.8 12.4 10.1
82 tied 65 100 95 87 75 tied 80 tied 97 tied 91 tied 78 73 90
APPENDIX D
Top 100 Authors for Weighted Opportunity Recognition Papers in Combined Periods (1995-2006)
224
APPENDIX D Top 100 Authors for Weighted Opportunity Recognition Papers in Combined Periods (1995-2006)
Rank 1 2 3 6 7 8 9 10 11 14 15 17
18
30 31 32 33 34 35
Total Wtd Papers 2.50 2.33 2.00 2.00 2.00 1.94 1.87 1.62 1.60 1.50 1.43 1.43 1.43 1.20 1.15 1.15 1.05 1.00
Author Scott A. Shane Robert A. Baron Lowell W. Busenitz Gregory G. Dess Maria Minniti Sankaran Venkataraman G. Thomas Lumpkin Dean A. Shepherd Connie Marie Thomas B. Ward Norris F. Krueger, Jr. Deniz Ucbasaran James O. Fiet Robert P. Singh Andrew C. Corbett Paul Westhead Pia Arenius Silvia Dorado
1.00 1.00 1.00
Truls Erikson Denise E. Fletcher Benson Honig
1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 0.97
Elaine Mosakowski Joel Podolny Diamanto Politis Robert D. Russel Sukhpal Singh Raymond W. Smilor Robert J. Sternberg Toby E. Stuart Mike Wright
0.83 0.75 0.72 0.64 0.63
Shakar A. Zahra Jeffery S. McMullen Gerald E. Hills Sharon A. Alvarez Dawn R. DeTienne
Affiliation University of Maryland Renssalaer Polytechnic Institute University of Oklahoma University of Kentucky Babson College
Country US US US US US
University of Virginia University of Illinois at Chicago Indiana University, Bloomington San Francisco State University University of Alabama Boise State University University of Nottingham University of Louisville Morgan State University Renssalaer Polytechnic Institute University of Warwick University of Lausanne University of Massachusetts Manchester Metropolitan University University of Sheffield University of Haifa University of California Las Angeles Stanford University Lund University Pennsylvania State University Institute of Rural Management Kauffman Foundation Yale University Columbia Business School University of Nottingham University of Minnesota, Minneapolis Baylor University University of Illinois at Chicago Ohio State University Utah Slate University
US US US US US US UK US US US UK Switzerland US
225
UK UK Israel US US Sweden US India US US US UK US US US US US
Rank 36
38
43 44
45
Total Wtd Papers 0.61 0.61 0.55 0.55 0.55 0.55 0.55 0.53 0.52 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50
Author G. Dale Meyer Jerome A. Katz Alistair R. Anderson Dirk de Clercq Jonathan T. Eckhardt Michael D. Ensley Sarah L. Jack Benyamin M. Bergmann William D. Bygrave D. Ray Bagby Julian Birkinshaw Mike Chiasson Mary M. Crossan Donna Marie De Carolis Waverly Ding Dev K. Dutta Kimberly A. Eddleston Tom Elfring Anthony Endres Nick Fry Willem Hulsink James G. Hunt Mariann Jelinek Franz W. Kellermanns E. Sendil Misra Chung-Ming Lau Joo-Heon Lee Joseph A. Litterer Sasi Misra Ronald K. Mitchell William T. Moore William I. Norton, Jr. Leslie E. Palich Arja Ropo Patrick Saparito Chad Saunders Olav Sorenson G. Page West III Johan Wiklund Christine Woods Congcong Zheng
Affiliation University of Colorado at Boulder Saint Louis University University of Aberdeen Ghent University University of Wisconsin at Madison Renssalaer Polytechnic Institute University of Aberdeen Univ. of Massachusetts at Boston Babson College Baylor University Stockholm University University of Calgary University of Western Ontario Drexel University University of California at Berkeley University of Western Ontario Northeastern University Free university University of Auckland University of Western Ontario Free university Texas Tech University College of William & Mary Mississippi State University University of Pennsylvania Chinese University of Hong Kong Yonsei University University of Massachusetts Indian Institute of Management Texas Tech University University of South Carolina University of Louisville Baylor University University of Tampere Drexel University University of Calgary University of California Las Angeles Wake Forest University Jönkoping University University of Auckland London Business School
226
Country US US Scotland Belgium US US Scotland US US US Sweden Canada Canada US US Canada US Netherlands New Zealand Canada Netherlands US US US US Hong Kong South Korea US India US US US US Finland US Canada US US Sweden New Zealand UK
Rank 77 78 79 81 82 83 84 86
87
Total Wtd Papers
Author
0.45 0.44
Per Davidson Michael A. Hitt
0.42
Richard N. Cardozo
0.42 0.40 0.39 0.38 0.37 0.37 0.36 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33
Alexander Ardichvili Erik Hunter Magnus Klofsten Jeffrey E. McGee Hean Tat Keh Sourav Ray Paul N. Friga E. Tory Higgins Richard L. Priem Paul D. Reynolds Pino G. Audia Pam Bah Gaurab Bhardwaj Subodh Bhat Joel Brockner John C. Camillus Nicholas Dew Maw-Der Foo John H. Freeman David A. Hounshell R. Duane Ireland Boon Chong Lim Murray B. Low Richard L. McCline J. Robert Mitchell Pankaj C. Patel Christopher L. Shook S. Ramakrishna Velamuri
0.33
R. Isil Yavuz
Affiliation Brisbane Graduate School of Business Arizona State University University of Minnesota, Minneapolis University of Illinois at Urbana– Champaign Jönkoping University Linkoping University University of Texas at Arlington National University of Singapore Concordia University Indiana University, Bloomington Columbia University University of Wisconsin-Milwaukee Florida International University University of California at Berkeley San Francisco State University Babson College San Francisco State University Columbia University University of Pittsburgh Naval Postgraduate School National University of Singapore University of California at Berkeley Carnegie Mellon University University of Richmond National University of Singapore Columbia University San Francisco State University Indiana University, Bloomington University of Louisville University of Texas at Arlington IESE Business School University of Minnesota, Minneapolis
227
Country Australia US US US Sweden Sweden US Singapore Canada US US US US US US US US US US US Singapore US US US Singapore US US US US US Spain US
APPENDIX E
Top 100 Affiliations for Weighted Opportunity Recognition Papers in Combined Periods (1995-2006)
228
APPENDIX E Top 100 Affiliations for Weighted Opportunity Recognition Papers in Combined Periods (1995-2006)
Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 18 19 20 21 22 23 24 25 27
Affln Wtd Papers 4.417 3.820 2.933
2.907 2.600 2.500 2.000 1.944 1.930 1.723 1.717 1.650 1.551 1.500 1.500 1.500 1.500 1.292 1.267 1.217 1.167
1.133 1.100 1.058 1.050 1.050 1.033
Affiliation Renssalaer Polytechnic Institute University of Nottingham Babson College University of Illinois at Chicago San Francisco State University University of Maryland Eastern Washington University University of Virginia University of Colorado at Boulder University of Louisville University of Western Ontario Baylor University Jönköping University University of Alabama University of California Las Angeles University of Houston University of Massachusetts Indiana University, Bloomington Boise State University University of Texas at Arlington University of California at Berkeley University of Minnesota, Minneapolis University of Aberdeen University of the Pacific Clemson University Stockholm University National University of Singapore
229
Country US UK US US US US US US US US Canada US Sweden US US US US US US US US US Scotland US US Sweden Singapore
Rank
28
44
Affln Wtd Papers 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 0.833 0.833
46
0.817
47
0.800 0.766 0.766 0.744
48 50 51 52 53 54 55 56
0.683 0.644 0.611 0.600 0.567 0.550 0.550 0.550
Affiliation Columbia University Drexel University Free university Institute of Rural Management Kauffman Foundation Lund University Manchester Metropolitan University Memorial University of Newfoundland Pennsylvania State University Stanford University University of Auckland University of Haifa University of Kentucky University of Lausanne University of Sheffield Yale University Fort Lewis College Texas Tech University University of Illinois at Urbana– Champaign University of South Carolina London Business School New York University Ohio State University University of Victoria Georgia State University Saint Louis University University of Wisconsin at Madison Northeastern University College of William & Mary Ghent University University of Chicago
230
Country US US Netherlands India US Sweden UK Canada US US New Zealand Israel US Switzerland UK US US US US US UK US US Canada US US US US US Belgium US
Rank
59
73 74 75
76
84 85 87 88 89 90 93 94 95 96 98 99
Affln Wtd Papers 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.500 0.478 0.388 0.367 0.333 0.333 0.333 0.333 0.333 0.333 0.333 0.333 0.299 0.250
0.250 0.236 0.233 0.216 0.200 0.200 0.200 0.167 0.166 0.165 0.150
0.150 0.116 0.111 0.111
Affiliation California State University - Long Beach California State University San Bernardino Chinese University of Hong Kong Columbia Business School Indian Institute of Management Mississippi State University Northeastern State University University of Central Florida University of Massachusetts at Boston University of Oklahoma University of Pennsylvania University of Tampere Wake Forest University Yonsei University Arizona State University Linköping University Concordia University Carnegie Mellon University Florida International University IESE Business School Naval Postgraduate School Texas A&M University University of Pittsburgh University of Richmond University of Wisconsin-Milwaukee Stevens Institute of Technology University of Iowa Worcester Polytechnic Institute University of Southern California Hong Kong Polytechnic University Georgia Institute of Technology Monash University University of Oregon Waseda University Brigham Young University University of Cincinnati Brisbane Graduate School of Business University of British Columbia University of St. Thomas Case Western Reserve University Boston University Marquette University
231
Country US US Hong Kong US India US US US US US US Finland US South Korea US Sweden Canada US US Spain US US US US US US US US US Hong Kong US Australia US Japan US US Australia Canada US US US US
