The Review of Black Political Economy

, Volume 14, Issue 4, pp 79–89 | Cite as

Market structure and minority presence: Black-owned firms in manufacturing

  • Arthur G. Woolf
Articles

Abstract

This study uses a market structure framework to analyze the presence of black-owned businesses in manufacturing sectors of the U.S. economy in 1972. Tobit analysis reveals that black-owned firms tend to be concentrated in those industries with a relatively large small-business presence. High advertising expenditures are a significant barrier to black presence in a given industry. The amount of government purchases from an industry is found to have no significant relationship to black presence.

Keywords

Small Firm Capital Intensity Entry Barrier Industry Growth Black Business 
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Notes

  1. 1.
    Timothy Bates, “An Analysis of the Minority Entrepreneur: Traits and Trends” (September 1984), report to the U.S. Department of Commerce Minority Business Department Agency, pp. 67–82.Google Scholar
  2. 2.
    Bates, pp. 68–9.Google Scholar
  3. 3.
    Bates, pp. 79–80.Google Scholar
  4. 4.
    Bates, pp. 14 and 27.Google Scholar
  5. 5.
    Calculated from data inSurvey of Minority-Owned Business Enterprises, Census of Manufactures, andStatistical Abstract of the United Stales, various years.Google Scholar
  6. 6.
    Douglas F. Greer,Industrial Organization and Public Policy, 2nd ed. (New York, Macmillan, 1984), pp. 169–171.Google Scholar
  7. 8.
    For an analysis of both sides of this issue, see the essays by Yale Brozen and H. Michael Mann in Harvey Goldschmid, et al. (eds.),Industrial Concentration, The New Learning (New York: Little Brown, 1974), pp. 114–161.Google Scholar
  8. 9.
    See Morris A. Adelman, “Concept and Statistical Measurement of Vertical Integration,” in George J. Stigler (ed.),Business Concentration and Price Policy (Princeton: NBER-Princeton University Press, 1955), pp. 281–322 for an analysis of this as a proxy for a measure of vertical integration.Google Scholar
  9. 10.
    This follows the cutoff used by Lawrence J. White, “The Determinants of the Relative Importance of Small Business,”Review of Economics and Statistics (February 1982), pp. 42–49. White found his results invariant to the choice of a definition of size of small business.Google Scholar
  10. 11.
    Ibid., pp. 47–48.Google Scholar
  11. 12.
    Timothy Bates,Black Capitalism: A Quantitative Analysis (New York: Praeger, 1973), chapter 2.Google Scholar
  12. 13.
    Growth of minority business set-asides is examined in Timothy Bates, “Black Entrepreneurship and Government Programs,”Journal of Contemporary Studies (Fall 1981), pp. 67–9.Google Scholar
  13. 14.
    See G. S. Maddala,Econometrics (New York, McGraw-Hill, 1977). The original source is James Tobin, “Estimation of Relationships for Limited Dependent Variables,”Econometrica 26 (January 1958), pp. 24–36.Google Scholar

Copyright information

© Springer 1986

Authors and Affiliations

  • Arthur G. Woolf

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