Contact: Phil Hearn
STARKVILLE, Miss.--A Mississippi State management professor says the national Small Business Development Center program generates more tax revenue than it costs to run--and he's sharing research data with Congress to back that assertion.
"My overall conclusion is that the SBDC program has a significant, positive impact on economic development, as measured by job creation, GDP (gross domestic product) growth and, ultimately, tax revenues generated," James Chrisman said in testimony earlier this month before a U.S. congressional committee studying the issue.
"Put differently, through the increases in jobs and sales revenues of client firms, the program provides other societal benefits because it returns more in tax dollars to the nation than it costs to operate the program," Chrisman told the U.S. House Committee on Small Business, chaired by Rep. Donald Manzullo, R-Ill.
A professor in MSU's management and information systems department since 2002, Chrisman has conducted extensive studies of the SBDC's economic impact over the past 23 years. Because of that expertise, he was invited by Manzullo to participate in a Washington, D.C., hearing on "Small Business Development Centers: New Offerings for a New Economy." "Dr. Chrisman has made significant contributions to our understanding of the value of entrepreneurship and small business to the economy, and to recognizing the keys to successful entrepreneurial activities," said Dean Sara Freedman of the College of Business and Industry that includes Chrisman's department.
Manzullo said his congressional committee "is examining legislative initiatives designed to select existing small business development centers for increased efforts in regulatory compliance, Native American small business growth, vocational education, and advice to second-stage entrepreneurs."
Based on his research, Chrisman estimated SBDC's long-term clients created more than 56,000 new jobs between 2002 and 2003, and produced more than $5.9 billion in incremental sales revenues. He also noted approximately $7 billion in sales and 59,000 jobs were saved because of SBDC interventions.
"Translated into sales and income taxes, I estimated that these improvements generated approximately $475 million in tax revenues for federal and state governments," Chrisman asserted. "This tax revenue exceeded the contributions of federal and state governments toward the operation of the program by a radio of 2.48 to 1.00."
Chrisman earned a bachelor's degree in finance from Western Illinois University in 1980, a master's in business administration degree from Bradley University in 1982, and a doctorate in strategic management from the University of Georgia in 1986.
He was a professor of entrepreneurship and innovation at the Haskayne School of Business at the University of Calgary (Canada) from 1993 until joining the MSU faculty.
NEWS EDITORS/DIRECTORS: For more information, contact Dr. Chrisman at (662) 325-1991 or jchrisman@cobilan.msstate.edu.