Big Is Beautiful: Debunking the Myth of Small Business

by Robert D. Atkinson, Michael Lind

Overview

Why small business is not the basis of American prosperity, not the foundation of American democracy, and not the champion of job creation.

In this provocative book, Robert Atkinson and Michael Lind argue that small business is not, as is widely claimed, the basis of American prosperity. Small business is not responsible for most of the country's job creation and innovation. American democracy does not depend on the existence of brave bands of self-employed citizens. Small businesses are not systematically discriminated against by government policy makers. Rather, Atkinson and Lind argue, small businesses are not the font of jobs, because most small businesses fail. The only kind of small firm that contributes to technological innovation is the technological start-up, and its success depends on scaling up. The idea that self-employed citizens are the foundation of democracy is a relic of Jeffersonian dreams of an agrarian society. And governments, motivated by a confused mix of populist and free market ideology, in fact go out of their way to promote small business. Every modern president has sung the praises of small business, and every modern president, according to Atkinson and Lind, has been wrong.

Pointing to the advantages of scale for job creation, productivity, innovation, and virtually all other economic benefits, Atkinson and Lind argue for a “size neutral” policy approach both in the United States and around the world that would encourage growth rather than enshrine an anachronism. If we overthrow the “small is beautiful” ideology, we will be able to recognize large firms as the engines of progress and prosperity that they are.

Product Details

ISBN-13:	9780262537100
Publisher:	MIT Press
Publication date:	02/26/2019
Series:	The MIT Press
Edition description:	Reprint
Pages:	368
Product dimensions:	5.60(w) x 8.60(h) x 0.80(d)
Age Range:	18 Years

About the Author

Robert Atkinson is Founder and President of the Information Technology and Innovation Foundation, a Washington, D.C. think tank, and coauthor of Innovation Economics: The Race for Global Advantage.

Michael Lind is a Visiting Professor at the Lyndon B. Johnson School of Public Affairs of the University of Texas and author of Land of Promise: An Economic History of the United States.

Table of Contents

Preface vii

Acknowledgments xi

Part I History and Present Trends

1 Belittled: How Small Became Beautiful 3

2 Why Business Got Big: A Brief History 19

3 Understanding US Firm Size and Dynamics 37

Part II The Advantages of Size

4 The Bigger the Better: The Economics of Firm Size 63

5 Small Business job Creation: Myth Versus Reality 81

6 The Myth of the Genius in the Garage: Big Innovation 95

7 Small Business in a Big World 117

Part III Politics and Policy

8 A Republic, If You Can Keep It: Big Business and Democracy 135

9 The Strange Career of Antitrust 155

10 Brandeis Is Back: The Fall and Rise of the Antimonopoly Tradition 177

11 Has Big Business Gotten Too Big? 199

12 Small Business Cronyism: Policies Favoring Small Business 221

13 Living with Giants 241

Notes 269

Index 335

What People are Saying About This

Endorsement

In an age of mindless partisanship and chronic groupthink, Atkinson and Lind are just the kind of antidote that we need. Whether you agree with their thesis or not—and especially if you disagree—you should read this book. You will not have wasted your time.

—Edward Luce, Washington commentator, Financial Times

From the Publisher

Atkinson and Lind's deeply researched book is a needed corrective to current unexamined assumptions about job creation. While acknowledging that the power of giants can bring abuses, they make a compelling case about the virtues of size and scale for innovation and national enrichment. Agree or not, their economic prescriptions are sure to be discussed widely by policy makers of all political persuasions.

—Rosabeth Moss Kanter, Professor, Harvard Business School; author of Move: Putting America's Infrastructure Back in the Lead

Atkinson and Lind present a well-researched and thoughtful correction to the widely held view that it is small business alone that is the engine of economic progress. Their focus on the importance of scale is both historically grounded and eminently relevant to today's connected and information-driven global economy. Big Is Beautiful should be read by business leaders and policy makers around the world.

—Sam Palmisano, Chairman, The Center for Global Enterprise; former Chairman and CEO, IBM

Atkinson and Lind reconstruct the history of economic development to document the role of large enterprises in driving technological innovation and growth. Their nuanced analysis shows how monopoly profits—however transient they may prove to be—are essential to motivate and to fund R&D at the frontier. From Kodak and DuPont through IBM and Xerox to Google and Amazon, the giant firms have been central to this history, outweighing the much hailed but largely sentimentalized celebration of small business.

—Dr. William H. Janeway, Senior Advisor, Warburg Pincus; Affiliated Member of Economics Faculty, University of Cambridge

In an age of mindless partisanship and chronic groupthink, Atkinson and Lind are just the kind of antidote that we need. Whether you agree with their thesis or not—and especially if you disagree—you should read this book. You will not have wasted your time.

—Edward Luce, Washington commentator, Financial Times

Editorial Reviews

Big Is Beautiful succeeds in highlighting why it is in our collective interest to find ways to help the biggest corporations earn back our trust.—New York Times—

The authors are correct that many people overrate both the benefits of small business and the evils of bigness. And although antimonopolism is rightly getting renewed attention, it is not equipped to deal with most of what ails the economy.

—Harvard Business Review—

From the Publisher

The authors are correct that many people overrate both the benefits of small business and the evils of bigness. And although antimonopolism is rightly getting renewed attention, it is not equipped to deal with most of what ails the economy.

—Harvard Business Review

Reviews