Self-Employment for Low-Income People

By Steven Balkin | Go to book overview

8
Policies to Encourage Self- Employment for Low-Income Persons: Modest Goals and Supportive Linkages

INTRODUCTION

Four policies for expanding low-income peoples' participation in selfemployment activity are considered: do nothing, remove government impediments, develop programs, and create supportive institutions. One could choose any one of the four alone as a self-employment policy, or choose some combination. 1 This chapter discusses the first three selfemployment policies. Creating supportive institutions is presented as a continuation of the policy discussion in the next chapter. Three themes run throughout many of these policies: goals should be modest to ensure attainment, clients should be linked to supports that can ensure success, and focus should be on people at the very bottom of the income distribution.


DO NOTHING

We know from Chapter 3, that low-income people do engage in selfemployment activity on their own. Perhaps there is a natural rate of self-employment for low-income people and any interference, no matter what the intentions, will cause economic harm to them. Three situations come to mind where interventionist efforts to actively expand self-employment activity of low-income people may harm them: overcrowding, ignoring the side benefits of informal capital acquisition, and inadequate substitution for transfer payments.

Assisting a large number of persons to start small businesses in a particular sector increases the supply of goods and services in that sector and may depress prices. This is good for the consumer but the

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Self-Employment for Low-Income People
Table of contents

Table of contents

  • Title Page iii
  • Contents vii
  • Tables and Figures ix
  • Foreword xi
  • Preface xv
  • Acknowledgments xvii
  • I - Background 1
  • 1 - Introduction 3
  • Notes 9
  • 2 - Self-Employment Theories 13
  • 3 - Empirical Analyses of Self- Employment 27
  • Notes 46
  • 4 - Immigrant and Ethnic Group Experience with Self-Employment 51
  • Notes 65
  • 5 - Black Business Movements 69
  • Notes 86
  • II - Program Descriptions 91
  • 6 - Self-Employment Programs in the Third World and Europe 93
  • Notes 108
  • 7 - Self-Employment Training Programs in the United States Targeted to Low-Income People 113
  • Notes 136
  • III - Policy and Education 141
  • 8 - Policies to Encourage Self- Employment for Low-Income Persons: Modest Goals and Supportive Linkages 143
  • Notes 160
  • 9 - Policies to Encourage Self- Employment for Low-Income Persons: Creating Supportive Institutions and a Research Agenda 163
  • Notes 183
  • 10 - Job Creation Through Encouragement of Self-Employment 189
  • 11 - Evaluation for Self-Employment Programs 197
  • Notes 204
  • Bibliography 207
  • Index 229
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