Creating a Positive Political Setting for Small Business

Entrepreneurs face tough conditions because the current political setting favors big business. Baumol, Litan, and Schramm (2007) talked about when capitalism is good for entrepreneurs and when it is not. Baumol (1990) explained that historically entrepreneurship has flourished when political conditions favored small business. Such conditions recently have existed in China and the Far East, but not here in the United States (Cooke, 2008).

What can people do to improve conditions for small business and entrepreneurs? Big companies have enlisted special interest groups to influence politicians and trump the vote of the people, but that does not make the people helpless to turn the setting around. Although globalism started out well and a place initially existed for small companies in the supply chain, big companies now want to eliminate the middleman through mergers and takeovers leaving many small business unable to have a level playing field with which to compete.

What can people do to restore the growth engine small business provides this economy? People still have dollar votes and can buy from small companies when alternatives exist between large and small companies.  I encourage people to do so. I will post a directory of small businesses offering alternative products to those produced by the big companies on our website if a company is qualified and has no interest in it by a large company. Please let us know the product and company information and I will start a directory to promote the idea of buying from small companies. Please leave your information on our website.


Cooke, F. L. (2008). Competition and strategy of Chinese firms: An analysis of top performing Chinese private enterprises. Competitiveness Review: An International Business Journal incorporating Journal of Global Competitiveness, 18(1), 29-56. doi: 10.1108/10595420810874592

Baumol, W. J., Litan, R. E., & Schramm, C. J. (2007). Good capitalism, bad capitalism and economics of growth and prosperity. New Haven, Conn. and London: Yale University Press.

Baumol, W. J. (1990). Entrepreneurship: Productive, unproductive, and destructive. Journal of Political Economy, 98(5), 893-921. Retrieved from

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