Belmont University

Small Business Public Policy Ranking

Fortune Small Business released rankings from the Small Business & Entrepreneurship Council (SBE Council). SBE Council advocates reduced government taxes and regulations on small business. The rankings are derived from the SBE Council's Small Business Survival Index.

This year's list from the SBE Council measures states on 29 criteria, including tax rates on income, property and capital gains; health-care regulations; crime rates; government spending; bureaucracy; and labor costs.

The top 10:

1-South Dakota
2-Nevada
3-Wyoming
4-Alabama
5-Washington
6-Florida
7-Mississippi
8-Colorado
9-Texas
10-Michigan

The bottom 10 includes the usual suspects:

51- Washington, D.C. (does anybody else share my concern on this one??)
50-New Jersey
49-California
48-Rhode Island
47-Maine
46-Minnesota
45-New York
44-Hawaii
43-Massachusetts
42-Vermont
41-Iowa

For my local readers, Tennessee came in 13th.


Posted by Jeff Cornwall on November 1, 2006 05:39 AM |

Comments


A number of questions arise from these rankings that aren't answered by the online article. For example:

(1) What weighting is assigned to each the 29 listed criteria?

(2) How is the weighting determined?

(3) Why were those criteria selected over any number of other seemingly relevant criteria such as the quality/education of the workforce that the small business will employ?

Like many of these rankings, the value may be in what is behind the assumptions (and manipulations?) of the authors.

Birdied by: Lee | November 1, 2006 07:31 AM

Good point. I added a link to the pdf file at SBE that gives details on the rankings. Let me know what you think after you have had a chance to review this material.

Birdied by: Jeff | November 2, 2006 06:02 AM

Hi Jeff:

Thanks for the pdf link. After reviewing their reasoning and methodology, it seems that the answers to my questions would be as follows:

1. Equal weighting of all factors - the reasons for this are not given.

2. Not described.

3. No analysis provided. That is, the authors have some sense, backed by the literature, that taxes and regulation impact the success of small businesses, so they used those factors. No discussion is attempted to evaluate the many other factors that may or may not determine success and their relative impact.

Overall, the study appears quite shabby and the results predetermined. Too bad, since I think a well-designed study of the factors that truly impact small business success would be a powerful tool for policy development.

Birdied by: Lee Dillion | November 2, 2006 08:31 AM

Tap it in and Comment, Please

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