Growing concentration in the marketplace, encouraged by government regulatory policies, is "making small business an endangered species in America," according to a new study released by the National Center for Economic Alternatives.
The economic study group says 80 percent of small businesses fold up before they reach their fifth year of operation, "while many others are taken over by coorporate giants."
The center called the Federal Reserve Board's tight money policies a major cause of such failures.
It also contends that the federal government has failed to adequately enforce antitrust laws and control inflation, "driving small and medium-sized companies out of business or into mergers with the larger corporate giants which increasingly dominate the American economic landscape."
Further, the center contends, small businesses receive less than a fair share of government procurement and research and development funds, while carrying a disproportionate tax and regulatory burden.
"Policies in the area of taxation, regulations, and government procurement are not usually consciously designed to damage small businesses or put them at a disadvantage in competition with larger firms. But that has been their overall impact," said center codirectors Gar Alperovitz and Jeff Faux.
In calling for such new government initiatives as special loan rates, tax breaks and other advantages for small businesses, the center said small businesses is a vital sector of the U.S. economy that must be preserved.
"Small businesses -- not the giants -- are producing the lion's share of new jobs. We are killing the real goose that lays the golden eggs," said Alperovitz. "Fully 99 percent of private sector jobs between 1969 and 1976 were created by firms not listed among the Fortune 1,000.
"Moreover, over half the inventions in the U.S. in recent years were produced by small business and individual entrepreneurs."