Classy behavior: the big political role of small business owners

Abstract

Many theories assign important political roles to small business owners as part of the middle and upper middle class. Despite this, we have surprisingly little empirical work on the political behavior of small business owners. Using the European Social Survey covering 28 countries over six waves from 2002 to 2012, we find that small business owners are indeed more politically active despite their diversity across sectors and countries. This counters a great deal of existing work which emphasizes the wide divergence in small business owners’ political behavior within and across countries. Rather, we find that owning a small business does have a distinct effect on political behavior in many different contexts.

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Fig. 1

Notes

  1. 1.

    We thank an anonymous reviewer for the example of the Poujade movement.

  2. 2.

    Organization for Economic Cooperation and Development (OECD), “Small and Medium-sized Enterprises: Local Strength, Global Reach,” 2000 (available at http://www.oecd.org/regional/leed/1918307.pdf).

  3. 3.

    We use the term “small firm” as it is conventionally used to mean firms with less than 500 employees. Some sources will refer to these as “small- and medium-sized enterprises,” or SMEs. For consistency and clarity, we use the term “small firms” throughout the paper.

  4. 4.

    Others have challenged this view and argued that it is mostly large firms that account for most newly created jobs, and these jobs tend to have higher survival rates (Davis et al. 1996).

  5. 5.

    William Dunkelberg, “Entrepreneurs Can Solve the Unemployment Problem? If Government Gets Out of the Way,” Forbes, January 1, 2013 The presence of many small firms is also considered to be important for competitive economies (Ayyagari et al. 2007; Benacek 1995; Wilson Sokhey and Kadir Yildirim 2013).

  6. 6.

    We thank an anonymous reviewer for pointing out the diversity of business associations and for the example of Handwerk in Germany.

  7. 7.

    See more about compulsory membership in Handwerk at https://www.zdh.de/en0/organisation/ (accessed October 2017).

  8. 8.

    Indeed, even membership in business associations presents notable challenges for small businesses as a basic form of collective action. For example, the difficulty in attracting members by the Federation of Small Businesses in the UK is a case in point (Jordan and Halpin 2004).

  9. 9.

    For one variable—union density—there are no data for Israel and Ukraine and the only data for Slovenia are from 2008. These countries are omitted from the analysis below.

  10. 10.

    We apply the correct population survey weights in the analysis although the results do not differ in the models that are estimated without these weights. The ESS also makes available country-level weights to account for the fact that roughly the same number of people is surveyed in each country even though country size differs. Country-level weights are not appropriate here in part because we directly model country-level influences.

  11. 11.

    We use the xtmixed command in Stata 13 for Models 1 and 2.

  12. 12.

    The predicted probabilities based on the model were conducted in Stata 13; all other values are held to their mean value.

  13. 13.

    As a robustness check, we also estimate Model 2 as a multilevel negative binomial model which accounts for the over-dispersion of responses in the low range of the index. Most people did none or only a few of the activities listed; 60% answered that they have engaged in none of the nine activities in the last 6 months. The results hold in the negative binomial model and are available in “Data appendix”.

  14. 14.

    We use the xtlogit command in Stata 13.

  15. 15.

    The estimates for the predicted probabilities assume that the random effect—i.e., the country-level effect—is zero.

  16. 16.

    See “Data appendix” at the end of the paper for the full results.

  17. 17.

    Jack Ewing, “Europe's Small Businesses Continue to Struggle," New York Times, April 26, 2013.

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Correspondence to Sarah Wilson Sokhey.

Data appendix

Data appendix

See Tables 5, 6, 7, 8, 9, 10, 11, 12 and 13.

Table 5 Summary of variables
Table 6 Random-intercept models of small firm owners’ political preferences and behavior
Table 7 Random-intercept models of small firm owners’ political preferences and behavior, cont.
Table 8 Model 2 robustness check: negative binomial model
Table 9 Model 2 robustness check: negative binomial model, cont.
Table 10 Random-intercept logit models of small firm owners’ political behavior, part 1
Table 11 Random-intercept logit models of small firm owners’ political behavior, part 1, cont.
Table 12 Random-intercept logit models of small firm owners’ political behavior, part 2
Table 13 Random-intercept logit models of small firm owners’ political behavior, part 2, cont.

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Schaffer, J., Sokhey, S.W. & Kadir Yildirim, A. Classy behavior: the big political role of small business owners. Comp Eur Polit 17, 22–48 (2019). https://doi.org/10.1057/s41295-017-0110-1

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Keywords

  • Small business
  • Business owners
  • Middle class
  • Political participation
  • Right-wing politics
  • European Social Survey