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Management article
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Reference no. 90604
Authors: R Howard
Published by: Harvard Business Publishing
Published in: "Harvard Business Review", 1990

Abstract

The latest research on the role of small business in the economy identifies three intriguingly counterintuitive claims. First, small business is most important where it is least predominant -- manufacturing. Second, the real issue isn''t size, it''s industrial organization -- the quality of relationships tying small companies to big companies and to each other. Third, a country''s capacity to build strong protection networks of this kind constitutes a new form of competitive advantage -- one in which the United States is relatively weak.

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Abstract

The latest research on the role of small business in the economy identifies three intriguingly counterintuitive claims. First, small business is most important where it is least predominant -- manufacturing. Second, the real issue isn''t size, it''s industrial organization -- the quality of relationships tying small companies to big companies and to each other. Third, a country''s capacity to build strong protection networks of this kind constitutes a new form of competitive advantage -- one in which the United States is relatively weak.

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