Entrepreneurship, knowledge and employment

Monopoly Capital and Entrpreneurship: Whither Small Business?

Lambert Thomas, University of Louisville

There has been a growing body of literature over the last several years on a possible decline in US entrepreneurship and the reasons for it. US small business formation and the jobs created by small businesses are supposed to be key elements in US economic growth. Many claim that without growth in small businesses and the jobs they provide that the US economy will either not grow at all or only very slowly. Therefore, small business formation is a possible key to understanding capitalism in the 21st century since under monopoly capital there is claimed to be a tendency toward economic concentration (at the expense of small business) and toward economic stagnation. Some of the general causes mentioned for less US entrepreneurism include high levels of personal debt (mortgages, student loans, credit cards, etc.) among the US populace and the increasing challenges that small businesses face against larger ones. Another concern is the amount of increasing business regulation and government presence in the US economy with which small businesses struggle more than larger ones. If entrepreneurism requires risk taking, then high levels of household debt and large, well-financed potential competitors may be hindering prospective entrepreneurs. This paper uses a monopoly capital perspective of entrepreneurism in which Paul M. Sweezy (1953) argued against Joseph Schumpeter’s view of entrepreneurship and innovation, and where both Sweezy and Baran (1966) pioneered work on how large corporations dominate modern capitalism and thereby push small businesses and entrepreneurs to the fringe of a modern capitalist economy.

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Keywords: big business, corporations, entrepreneurship, household debt, monopoly capital, small business

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