IDEAS home Printed from https://ideas.repec.org/a/pal/buseco/v46y2011i4p214-228.html

The Small Business Sector in Recent Recoveries

Author

Listed:
  • Michael J Chow
  • William C Dunkelberg

Abstract

Small businesses account for half of private GDP, half of the private workforce, and most new jobs. This paper documents that small businesses have fared unusually poorly in the current recovery, dragging down output and employment growth, even while large businesses and agriculture have prospered. The reasons for the poor performance of small business are documented and analyzed with data from surveys of the National Federation of Independent Business. The findings contradict much conventional wisdom relating to six broad aspects of small business activity: employment and hiring plans, expectations and investment, past sales and earnings, inventories, prices, and credit conditions. The implication of the findings is that a robust economic recovery for the entire U.S. economy will depend on public policy that is tailored to permit and encourage small business expansion.

Suggested Citation

  • Michael J Chow & William C Dunkelberg, 2011. "The Small Business Sector in Recent Recoveries," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 46(4), pages 214-228, October.
    • Handle: RePEc:pal:buseco:v:46:y:2011:i:4:p:214-228
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/be/journal/v46/n4/pdf/be201123a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: http://www.palgrave-journals.com/be/journal/v46/n4/full/be201123a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "Varieties of Crises and Their Dates," Introductory Chapters, in: This Time Is Different: Eight Centuries of Financial Folly, Princeton University Press.
    2. Michael Mussa, 2009. "Adam Smith and the Political Economy of a Modern Financial Crisis," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 44(1), pages 3-16, January.
    3. Bernanke, Ben S, 1983. "Nonmonetary Effects of the Financial Crisis in Propagation of the Great Depression," American Economic Review, American Economic Association, vol. 73(3), pages 257-276, June.
    4. repec:rnp:ecopol:09111 is not listed on IDEAS
    5. Christina D. Romer, 1999. "Changes in Business Cycles: Evidence and Explanations," Journal of Economic Perspectives, American Economic Association, vol. 13(2), pages 23-44, Spring.
    6. William C Dunkelberg & Jonathan A Scott & Michael J Chow, 2010. "Inflexible Wages and Prices? Evidence in the Current Recession," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 45(2), pages 94-101, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Aaron H. Anglin & Aaron F. McKenny & Jeremy C. Short, 2018. "The Impact of Collective Optimism on New Venture Creation and Growth: A Social Contagion Perspective," Entrepreneurship Theory and Practice, , vol. 42(3), pages 390-425, May.
    2. Dienes, Christian & Pahnke, André & Wolter, Hans-Jürgen, 2018. "Investitionsverhalten von kleinen und mittleren Unternehmen," IfM-Materialien 268, Institut für Mittelstandsforschung (IfM) Bonn.
    3. Rosa Caiazza & Phillip Phan & Erik Lehmann & Henry Etzkowitz, 2021. "An absorptive capacity-based systems view of Covid-19 in the small business economy," International Entrepreneurship and Management Journal, Springer, vol. 17(3), pages 1419-1439, September.
    4. Lai, Yanqing & Saridakis, George & Blackburn, Robert & Johnstone, Stewart, 2016. "Are the HR responses of small firms different from large firms in times of recession?," Journal of Business Venturing, Elsevier, vol. 31(1), pages 113-131.
    5. Maalouf, Jamal & Miklian, Jason & Hoelscher, Kristian, 2025. "Business survival strategies in a polycrisis: SME experiences from Beirut, Lebanon," Business Horizons, Elsevier, vol. 68(4), pages 461-477.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Moritz Schularick & Alan M. Taylor, 2012. "Credit Booms Gone Bust: Monetary Policy, Leverage Cycles, and Financial Crises, 1870-2008," American Economic Review, American Economic Association, vol. 102(2), pages 1029-1061, April.
    2. Pamfili Antipa & Vincent Bignon, 2018. "Whither Economic History? Between Narratives and Quantification," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(3), pages 17-36.
    3. Howard Bodenhorn, 2016. "Two Centuries of Finance and Growth in the United States, 1790-1980," Working Papers id:11352, eSocialSciences.
    4. Jonathon Adams‐Kane & Julián A. Caballero & Jamus Jerome Lim, 2017. "Foreign Bank Behavior during Financial Crises," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 49(2-3), pages 351-392, March.
    5. Ozlem Akin & José Montalvo & Jaume García Villar & José-Luis Peydró & Josep Raya, 2014. "The real estate and credit bubble: evidence from Spain," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 5(2), pages 223-243, August.
    6. Cohen, Joseph N & Linton, April, 2010. "The historical relationship between inflation and political rebellion, and what it might teach us about neoliberalism," MPRA Paper 22522, University Library of Munich, Germany.
    7. Fratianni, Michele & Giri, Federico, 2017. "The tale of two great crises," Journal of Economic Dynamics and Control, Elsevier, vol. 81(C), pages 5-31.
    8. Berger, Allen N. & Molyneux, Phil & Wilson, John O.S., 2020. "Banks and the real economy: An assessment of the research," Journal of Corporate Finance, Elsevier, vol. 62(C).
    9. Ebrahimi Kahou, Mahdi & Lehar, Alfred, 2017. "Macroprudential policy: A review," Journal of Financial Stability, Elsevier, vol. 29(C), pages 92-105.
    10. Buiter, Willem, 2014. "Central Banks: Powerful, Political and Unaccountable?," CEPR Discussion Papers 10223, C.E.P.R. Discussion Papers.
    11. Morais, Bernardo & Peydró, José-Luis & Roldán Peña, Jessica & Ruiz Ortega, Claudia, 2019. "The International Bank Lending Channel of Monetary Policy Rates and QE: Credit Supply, Reach-for-Yield, and Real Effects," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 74(1), pages 55-90.
    12. Kilian Huber, 2018. "Disentangling the Effects of a Banking Crisis: Evidence from German Firms and Counties," American Economic Review, American Economic Association, vol. 108(3), pages 868-898, March.
    13. Gerhard Illing & Yoshiyasu Ono & Matthias Schlegl, 2016. "Asset Prices and Leverage in a Model of Persistent Stagnation," ISER Discussion Paper 0988, Institute of Social and Economic Research, The University of Osaka.
    14. Kim, Dohan, 2025. "The Asymmetric Bank Distress Amplifier of Recessions," Policy Research Working Paper Series 11170, The World Bank.
    15. Lim , Jamus Jerome & Minne, Geoffrey, 2014. "Learning from financial crises," Policy Research Working Paper Series 6838, The World Bank.
    16. Kim Abildgren, 2012. "Financial structures and the real effects of credit-supply shocks in Denmark 1922-2011," European Review of Economic History, European Historical Economics Society, vol. 16(4), pages 490-510, November.
    17. Salter, Alexander William & Tarko, Vlad, 2017. "Polycentric banking and macroeconomic stability," Business and Politics, Cambridge University Press, vol. 19(2), pages 365-395, June.
    18. Giesecke, Kay & Longstaff, Francis A. & Schaefer, Stephen & Strebulaev, Ilya A., 2014. "Macroeconomic effects of corporate default crisis: A long-term perspective," Journal of Financial Economics, Elsevier, vol. 111(2), pages 297-310.
    19. Nückles, Marc, 2020. "Interest rate policy and interbank market breakdown," Economic Modelling, Elsevier, vol. 91(C), pages 779-789.
    20. Riccardo De Bonis & Andrea Silvestrini, 2014. "The Italian financial cycle: 1861-2011," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 8(3), pages 301-334, September.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:buseco:v:46:y:2011:i:4:p:214-228. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.