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People Powered Prosperity
David Boyle9 July 2015
New Weather Institute/David Boyle
Additionality?
Protectionism?
Local institutions?
Small firms impact
“Our research shows that regional economic growth is highly correlated with the presence of many small, entrepreneurial employers—not a few big ones." Glaeser, E.L. and Kerr, W. (2010), ‘The Secret to Job Growth: Think Small’, Harvard Business Review, July.
Ownership impact
“Economic growth models that control for other relevant factors reveal a positive relationship between density of locally owned firms and per capita income growth, but only for small (10-99 employees) firms, whereas the density of large (more than 500 workers) firms not owned locally has a negative effect.”Fleming, D.A. and Goetz, S.J. (2011), ‘Does Local Firm Ownership Matter?’, Economic Development Quarterly, August, vol. 25, (3), 277-281.
Market failure?
UK distribution of value-added (OECD figures)
Large business SMEs
UK bank investment in SMEs (BIS figures)
Large business SMEs
49% 51%
89%11%
What next?
• Joint team at the Treasury or Cabinet Office between very local economic practitioners and civil servants.
• Link up with a university business department with an expertise in the area.
• Hold the reins for a dialogue with the banks about their own potential role in funding and shaping an effective local lending infrastructure.
…find out more
www.newweather.org
www.friendsprovidentfoundation.org