Putting Government's Role in Perspective: The Impact of Government Programs on Entrepreneurs and Small Business Owners
Vol. Volume 1, Number 1 June/1996
Edward G. Rogoff and Myung-Soo Lee
Edward G. Rogoff is an Assistant Professor of Management at the School of Business, Baruch College, City University of New York and he is a faculty coordinator at the Baruch College Small Business Lab. Myung-Soo Lee is an Assistant Professor of Marketing at the School of Business, Baruch College, City University of New York and a former faculty coordinator at the Baruch College Small Business Lab.
Government affects entrepreneurs and small business owners through regulation and through programs and policies designed to foster business creation and growth. This study reports on small business owners' and entrepreneurs' perception of the government's impact. Both the positive and negative aspects of governmental impact were measured and correlated with business size, business type, characteristics of the entrepreneur, and goals and attitudes of the business owner. The authors propose a conceptual model that develops three aspects of government impact on small business owners: as regulator, tax collector, and helper. Empirical data from focus groups, open-ended questions and closed-ended questions administered to a sample of 231 small business owners in midsize cities in the eastern United States quantifies the perceived impact of these three factors. The results showed that the role of government is generally perceived as negative by small business owners and entrepreneurs, even if their businesses received help through government programs. The impeding role of government was more evident among more aggressive entrepreneurs and growth oriented businesses, clearly contrary to the true intention of government programs. Policy implications and future research issues are also discussed.
Entrepreneurship, small business, government regulation, government programs.