Minority-Owned Business Enterprises' Participation in International Trade

By Ekanem, N. Frank; Mahone, Charlie E., Jr. | Multinational Business Review, Fall 1998 | Go to article overview

Minority-Owned Business Enterprises' Participation in International Trade


Ekanem, N. Frank, Mahone, Charlie E., Jr., Multinational Business Review


This study is an attempt to explain empirically how much minority-owned enterprises with given firmspecific and owner-specific characteristics export. Based on the 1987 Bureau of the Census survey of minority-owned enterprises data, we have reached conclusions on the differences in the volume of exports of firms with given threshold characteristics, relative to enterprises which posses more or less of those characteristics. These characteristics are firm size, start-up capital, and the number of years in business. Selected owner characteristics considered are education, age, and prior work and management experience. These characteristics were selected to allow us to examine the effect of firm size and management characteristics, which have been the focus of literature investigations.

Introduction

In spite of the obvious potential contributions of exports to the national economy and individual corporations, many business enterprises do not endeavor to take advantage of the potential gains. The literature claims that one reason for this is the lack of national and corporate policy to stimulate export incentives. The other is the attitude of corporate managers who continue to regard exporting as a marginal business, Cavusgil et al (1981). The literature maintains that unless top management is ready to stress the importance of growth and commit corporate resources into market planning, the company cannot reap the full potentials of exporting. This is partly one of the reasons why the United States exports only about 5.8% of its GDP compared to Germany with about 26%, Canada with about 25% and Japan with about 10.5%, Knowlton (1988). Tremendous opportunities exist for the United States to export a lot more because the US has the largest single market and the US GDP is about four times as large as the rest of the world, Knowlton (1988). The US Department of Commerce estimates that about 25,000 jobs are created for each $1 billion of export, therefore a policy of job creation can be considered to be synonymous with a policy of export expansion. The 1993 North American Free Trade Agreement (NAFTA) and the Uruguay Round of trade agreement, otherwise known as the General Agreement on Tariffs and Trade (GATT) were therefore intended to increase the amount and strengthen the performance of export activity of the US firms.

What is the best strategy to increase US exports? It is estimated that small-and-medium sized businesses exhibit the fastest growth rates and generate more new jobs than large firms. It is also estimated that only ten percent of US exports are generated by small businesses, while 250 large multinational corporations account for approximately 85% of US exports. A substantial improvement in the US export performance will therefore require the participation of and involvement of a considerably large number of small-and-medium sized firms. Small-andmedium sized businesses produce a wide variety of goods and services, often of exceptionally high quality and possess the greatest degree of flexibility which allow them to profitably penetrate small markets using strategies that are difficult for large companies to implement, Dobrzynski (1985), Reagan (1984). Moreover small-and-medium sized firms are able to adapt quickly to fluctuating markets and play a major role in the global market. What role should minority-owned enterprises, generally known to be small, be expected to play in the national policy to increase US exports? Although so much is known about small-and-medium sized firms generally, nothing is known about what role minority-owned firms have played in American export activity. With so much unknowns about minority-owned businesses' ability to export, what policies should government adopt in order to enhance minorities' active participation in international trade?

The purpose of this study is to examine the determinants of exports by minority-owned firms. Minority-owned enterprises are those enterprises in which people of ethnic minorities, such as Blacks, Hispanics, Asians, Native Americans, Women, and other ethnic groups have majority shares. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Minority-Owned Business Enterprises' Participation in International Trade
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.