By Carol TiceSmall business owners spend a lot of time griping about federal interference in their lives. The tax burden. The regulations. How too many federal contracts go to giant corporations.
But could it be entrepreneurs are focusing their ire in the wrong direction?
Recently, the Institute for Justice, a Virginia nonprofit, released a series of interesting studies about the impact of state and local red tape on entrepreneurial effort. You can get an overview of their findings in the video below. The upshot: local regulations can make a dramatic difference in whether your town fosters entrepreneurial innovation or stifles it. In fact, many cities choke the life out of their small business community with arcane regulations, requirements for certification, fees, and other barriers.
For instance, in some places -- Philadelphia, for one -- it is simply illegal to operate a business from your home. Guess they don't want the founders of the next Hewlett-Packard to start a company in their garage there.
By contrast, Houston has no zoning ordinance at all -- do what you like, wherever you like is the rule here. There's no general business license requirement either, a benchmark the Institute found is a major predictor of whether small businesses will flourish.
How do your state and city rate in terms of being entrepreneur-friendly? Are you free to start a business, or tangled up in red tape? Leave a comment and let us know.
Photo & video courtesy of the Institute for Justice
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