I recently attended a conference of academic researchers hosted by the U.S. Department of Commerce, Minority Business Development Agency. All of the researchers were asked by the MBDA to help them develop the research agenda that would support the development of MBEs. Each participant was asked to write down three problems facing minority businesses. Of the 20 researchers in the room there was unanimity around one problem: access to capital.

Access to capital is one of the most persistent problems facing diverse business owners. But as an economist, I always felt that the lack of access to capital is both a cause and a symptom of larger problems. It is a cause for slower growt....