Date of Award

8-2017

Degree Type

Report

Degree Name

Master of Science (MS)

Department

Economics and Finance

Committee Chair(s)

Chris Fawson

Committee

Chris Fawson

Committee

Randy Simmons

Committee

Ryan Bosworth

Committee

Chad Albrecht

Abstract

In this paper, I explore the underdevelopment of the business sector on the Navajo reservation. I investigate why the Navajo reservation continues to be economically depressed and find that institutions unique to the reservation create barriers that disincentivize formal business development. I first conducted a literature review on general barriers to entrepreneurship. Second, I reviewed the institutional analysis of the Navajo reservation to understand how institutions affect potential entrepreneurs. Next, I summarized a three-phased entrepreneurship training program on the reservation. Finally, I assessed the results of the program and how it was effected by barriers to business development.

I conclude that there are three main barriers that discourage entrepreneurship. First, red tape and a complicated business license application process disincentivize new business development in the formal economy. Second, a lack of private property rights limit how entrepreneurs can access and develop land. Third, the Navajo reservation lacks access to lending opportunities, restricting the capital that is necessary to start a business. These barriers combine to create a vicious cycle of underdevelopment and poverty.

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