A public health perspective on small business development: a review of the literature

Figures & data

Table 1. Relationships between small business and community health.

Independent variable	Dependent variable	Magnitude (Direction)	Strength of evidence	Effect estimates
ECONOMIC DEVELOPMENT
Small Business Presence	County Level Health	Small (Increase)	Weak	In a multilevel model using data from 3,060 counties across the contiguous US, Blanchard, Tolbert, and Mencken found that a one standard deviation increase in the number of businesses with 1–4 employees per 100,000 people was associated with a 0.07 (SE: 0.0006) standard deviation lower county, level age-adjusted mortality rate, a 0.23 (SE: 0.00002) standard deviation lower county level percent obese, and a 0.126 (SE:0.00001) standard deviation lower county level percent of people with diabetes (Blanchard, Tolbert, and Mencken 2011)
	Local economic activity	Modest (Increase)	Weak	Based on studies across several cities (Civic Economics 2012b; Association, American Booksellers, civic economics, and Las Vegas First, 2012; Patel and Martin 2011) we find that local retailers return between 32.1% (The Urban Conservancy 2009) and 58.2% (Civic Economics, American Booksellers Association and Re Think Local, 2014) of their revenue to the local economy, in comparison to national chains which recirculate between 13.6% and 30.4% of revenue (Civic Economics, American Booksellers Association and Re Think Local, 2014). Additionally, for every $100 spent at locally owned businesses an additional $45 to $58 is contributed to the local economy (Patel and Martin 2011)
	Job creation	Small (Increase)	Weak/Inconclusive	Generally, there is a lack of consensus on the degree of job growth associated with small businesses. A study using data from all business establishments between 1992 and 2004 finds that net job creation is greatest among the smallest firms and establishments (<20 employees) and decreases as size of the establishment increases: establishments with 0–19 employees have an average net job creation rate of 2.7%, compared to a rate of −1.7% for establishments with 5,000 or more employees (Neumark, Wall, and Zhang 2011). Another study found that the smallest firms accounted for 79.5% of net new jobs (Edmiston 2007). Combining effects across studies of individual cities and counties we find that shifting 10% of purchasing from chains to small businesses would produce between 874 and 31,000 jobs, with variation by the size of the locality examined (Civic Economics 2012a). Other studies find that there is not a net job growth benefit from small firms, after controlling for firm age (Haltiwanger, Jarmin, and Miranda 2013), and that during the recession job growth among small businesses may have been more constrained than among larger firms (Siemer 2014)
Small Business Growth	Economic growth	Small (Increase)	Weak	Fleming and Goetz, using data across 2,953 counties in the US found that for each additional small business (10–99 employees) owned by a resident there was an associated 0.168 (p<0.001) percentage point increase in the county level income growth rate between 2000 and 2007, after adjusting for other determinants of income growth. For each additional small business, whether owned locally or not, there was a 0.185 (p < 0.001) percentage point increase in the county level income growth rate, after adjusting for the same factors. The authors state that all standard errors for estimates were robust but not reported (Fleming and Goetz 2011)
	Social Cohesion	Small (Increase)	Weak	In a nationwide study, Blanchard and Matthews found that at the county level a 1% increase in the percentage of total employment accounted for by the four largest business establishments was associated with a 0.138 (B = −0.138; SE:0.03) point decrease in the electoral politics index – a measure of participation in local politics through voting, following current events and knowledge of representatives – and a 16% (OR:0.84; SE 0.05) decrease in the odds of participating in protest activities (defined as petition signing, demonstrations, boycotts, marches, protests, local reform efforts or membership in local organizations) (Blanchard and Matthews 2006)
Small Business Density	Physical Activity	Small (Increase)	Weak	Based on data from two studies we find between a 90% (OR: 1.9) (Grasser et al. 2013) and 140% (OR:2.4) (Frank et al. 2007) higher odds of walking in high density vs. low density areas
Third Place Establishments (places where people gather)	Area Socioeconomic Status	Small (Increase)	Weak	A study of 4,533 small towns in metro and non-metro counties found that a one-unit increase in the natural log of the number of third places (establishments where people regularly interact socially) was associated with a statistically significant 0.0311 non metro and 0.0151 metro increase in median income, and a −1.4942 non metro and −1.0340 metro decrease in the poverty rate. Standard errors were not reported, and standardized coefficients were not disclosed due to small sample size (Tolbert et al. 2002)
Unemployment	Unintentional Injury	Modest (Decrease)	Moderate	Combining a nationally representative and single city study, we find that a 5.4% or greater increase in the unemployment rate is associated with between a 127% (HR: 2.27 no standard error or confidence interval reported) (Cubbin, LeClere, and Smith 2000) unintentional injury hazard ratio and 194% (IR:2.94 SE:1.79) higher incidence rate of unintentional injury, after adjustment (LaScala, Gerber, and Gruenewald 2000)
	Intentional Injury	Small (Decrease)	Moderate	Combining two nationally representative studies, we find that a 5.4% or greater increase in the unemployment rate is associated with between a 50% (RR: 1.5; 95% CI: 1.45,1.56) higher risk of homicide (Jones-Webb and Wall 2008) and 82% (no SE or CI reported) (Cubbin, LeClere, and Smith 2000) higher homicide hazard ratio, after adjustment for various confounders
COMMUNITY REVITILIZATION
Neighborhood Disadvantage	Health Care Access	Small (Decrease)	Moderate	A nationally representative study found that an increase in one standard deviation in neighborhood disadvantage (corresponding to a 4% increase in the unemployment rate, a 13% increase in the prevalence of poverty, or a 17% increase in the high school dropout rate) was associated with a statistically significant 24% (OR:0.76; SE: 0.11) lower odds of having a usual source of care, and a 70% (OR: 1.70; SE: 0.2) higher odds of experiencing an unmet health care need, after controlling for individual covariates and county level health care supply (Kirby and Kaneda 2005)
Neighborhood SES	Opportunities for Physical Activity	Small (Increase)	Weak	Differences in the measurement of neighborhood SES and the dependent variable make it difficult to combine effect estimates, but we generally find that studies show a positive relationship between area-level SES and opportunities for physical activity (Duncan et al. 2002; Estabrooks, Lee, and Gyurcsik 2003). In neighborhoods with less poverty, residents’ perceptions of the availability of neighborhood physical activity opportunities were higher (B = −3.60, SE = 1.89, p < .05) (Duncan et al. 2002). A study across census tracts in the US found that each additional $10,000 increase in median household income was associated with a 1.014 (IRR: 1.0135; SE: 0.0053 p < .001) increase in the difference in the logs of the number of locations for physical fitness facilities, 1.06 (IRR = 1.0619, SE: 0.0060; p < .001) increase in the difference in the logs of the number of membership sports and recreation clubs, 1.01 (IRR: 1.0102; SE: 0.0059; p<.05) increase in the difference in the logs of the number of dance studios, schools, and halls, and a 1.09 (IRR:1.0873; SE: 0.0085 p<.001) increase in difference in the logs of the number of public golf courses (Powell et al. 2006)
SOCIAL CAPITAL AND COMMUNITY COHESION
Social Capital	Infant Mortality	Modest (Decrease)	Moderate	Though the effect size differs greatly across studies, modeling strategies, and level of social capital assessed (state, neighborhood), there is generally a consistent negative relationship between area-level social capital and infant mortality (Buka et al. 2003; Folland 2007; Kawachi et al. 1997). We find that each point increase in social capital, is associated with between 0.12 (B = 0.12; SE = .02) (Kawachi et al. 1997) and 5.6 (B = 5.653; SE = 2.06) (Folland 2007) fewer infant deaths. Effect sizes were generally greater when measured at the neighborhood vs. state level
	All cause mortality	Modest (Decrease)	Weak/Moderate	Across two studies, we find a consistent negative relationship between area social capital and all cause mortality, but with a wide range of effect sizes: for each point increase in the overall level of trust in an area there was between 6.7 (B = -6.71; SE= 0.91) (Kawachi et al. 1997) and 480.7 (B = -480.7; SE = 71.004) (Folland 2007) fewer deaths per 100,000 people. Conversely, Kawachi et al. 1997; finds that each percent increase in self-report of mistrust was associated with an increase of 5.32 (B = 5.32; SE = .68) additional deaths per 100,000 people (Kawachi et al. 1997)
	Injuries	Modest (Decrease)	Moderate	In a study measuring state level social capital across 39 states, Kawachi et al. (1997) found each weighted percent increase in self-reported lack of social trust was associated with 0.51(B = 0.51 se:0.15) fewer injuries per 100,000 people (Kawachi et al. 1997). Another study found that, depending on modeling strategy, a 1% increase in self-reported social trust was associated with a decrease of between 2.812 (SE: 1.42) and 21.88 (SE: 8.04) unintentional injury related deaths per 100,000 persons (Folland 2007)
	Self-reported health	Small (Increase)	Moderate	Using results from two studies at the state level, we find that a 1% increase in self-reported mistrust (as measured by the General Social Survey) in row associated with self-reported health 0.45% (OR: 0.0045; SE: 0.001) (Mellor and Milyo 2005) and 1.9% (OR: 0.019; SE:0.33) (Subramanian, Kawachi, and Kennedy 2001) increase in the odds of reporting poor health, after adjusting for individual and state level covariates
				Note – many systematic reviews have been conducted on the relationship between various measures of social capital and self-reported health, but there is some disagreement on directionality, particularly depending on the type of social capital employed (i.e. bridging, bonding, linking). However, there is relatively strong evidence that community social capital is positively associated with self-reported health. Odds ratios for the relationship between area level social capital and self-rated health were generally attenuated after adjustment for individual social capital indicators in multilevel models (Kim, Subramanian, and Kawachi, 2008)
Collective Efficacy	Self-reported health	Modest (Increase)	Weak	Browning and Cagney found in a study of Chicago neighborhoods that after adjustment for various individual and neighborhood level covariates, a one standard deviation increase in collective efficacy was associated with a 17.2% (OR: 0.172; SE: 0.059) increase in the odds of self-reporting fair health or above, and a two standard deviation increase in collective efficacy was associated with a 27% reduction in the odds of reporting poor self-rated health (Browning and Cagney 2002)

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