Theory to Practice is an occasional blog series that explores the intersection of economic development research and current issues of debate within the practitioner community. In this post, Jamie McCall (Vice President of Policy and Research, CSBDF) and Scott Keen (Small Business Center Director, PCC) give an overview of CSBDF’s research report on how Piedmont Community College is helping foster small business development. The partnership between CSBDF and PCC is partially supported through the generous funding of the Z. Smith Reynolds Foundation and Wells Fargo.
Overcoming Path Dependency through Partnerships
One of the most frequent critiques of economic development research is that what “works” to create economic growth in one area does not work in another. For better and for worse, there is notable evidence that the economic destiny of a community is often shaped by forces beyond its control. Reflected in the idea that “place matters,” there are numerous factors that often seem to predestine a community’s inherent level of economic prosperity:
- Natural Geography: Places with desirable natural amenities and proximity to vibrant urban areas tend to have an advantage.
- Socioeconomic Characteristics: The vibrancy of local entrepreneurial networks is correlated with a community’s education and wealth levels.
- Social Capital: When communities have robust social networks and a strong civil society, they tend to have better economic development outcomes.
The idea that path dependency is largely responsible for economic and community development is well-validated by scholars. But path dependency does not mean community institutions should ignore their role as promoters of economic growth. To some degree, a community’s economic success can be shaped by the strength of its institutions. CSBDF’s latest research report explores this topic through the lens of how Piedmont Community College (PCC) is using best practices to be a central development actor in the region.
PCC’s and CSBDF’s Collaboration for Economic Development
As explained in the report, there is strong evidence that PCC’s partnership-based approach is an innovative and replicable model for other community colleges in North Carolina. One of the projects that CSBDF and PCC have collaborated on is the Building Opportunities on Savings and Trainings (BOOST) program. BOOST is innovative because it provides underserved entrepreneurs with a matching grant to help support their small business. To receive the grant, participants must complete a technical assistance curriculum and provide their own own seed capital (which is matched on a 1:1 basis by the grant).
The strategic combination of grant funding, affordable financing, and technical assistance makes BOOST a unique model for small business development. The use of microfinance for small businesses has a long history in international development, but this type of development program has rarely been attempted domestically. Yet there are many reasons to believe that this type of holistic development will be successful. Research has long suggested fostering microbusinesses is important in Southern rural geographies, and programs that combine microfinance with technical assistance have seen some success.
Our Commitment to Data-Based Interventions
We believe the BOOST program will lead to positive socioeconomic outcomes for participants. The impact of BOOST is already beginning to be recognized, and we’re proud to announce that the initiative recently received the NC Small Business Center Network’s “Center of Excellence” Innovation Award for Services/Collaboration. But we also know its important to ensure these types of development interventions are actually evaluated in a way that objectively demonstrates their success. We’re tracking participants through a longitudinal series of surveys and post-program semi-structured interviews to better understand how BOOST is helping promote small business in PCC’s community. We look forward to sharing those results in the coming year.