to fighting one's way through a blackberry brambel. In spite of all the efforts made, and all the scratchs suffered, the desired fruit is often just out of reach. In seeking a definition of small business for this study, several potential definitions were considered.
The Committee for Economic Development (CED) proposed some meaningful criteria for defining small business. The CED (1947) defined as small businesses those in which (1) management is independent, (2) capital is supplied by either an individual owner, or by a small group of individuals, (3) operations remain local, and (4) firm size is small relative to the industry. The firm size criterion creates a built in ambiguity in any attempt to define small business.
The management independence and capital provision criteria eliminate many contemporary entrepreneurial ventures from the small business category. Capital for a significant proportion of entrepreneurial ventures in the contemporary American economy is provided by venture capital firms. While these venture capitalists commit themselves to backing entrepreneurial innovation, they alsotend to place definite restrictions on the scope of entrepreneurial management prerogatives.
The 1980 White House Conference on Small Business defined a small business as one with 500 or fewer employees (U.S. Small Business Administration, 1980. This definition covers almost all business enterprises in the United States 99.7 percent (U. S. Small Business Administration, 1984). Business enterprises included in this definition accounted for 47.8 percent of non government and non farm employment, 42 percent of sales revenues, and 38 percent of the country's gross national product (GNP) in the early 1980s (U.S. Small Business Administration, 1984).
Andrew Nappi and Jay Vora (1980) provided criteria which are both more restrictive and more useful for defining small businesses. They restrict the small ...