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Perceptions and Experience of Employment Regulation in UK Small Firms

Author

Listed:
  • Sara Carter
  • Colin Mason
  • Stephen Tagg

    (Department of Marketing, University of Strathclyde, Stenhouse Building, 173 Cathedral Street, Glasgow G4 ORQ, Scotland)

Abstract

The view that excessive regulation constrains small business growth has been a persistent theme within business and policy communities, although recent studies have demonstrated the actual effects of regulation to be relatively modest. A prior small-scale study proposed four reasons why employment legislation does “not damage†small firms. We attempt to assess the robustness of these propositions in a large-scale survey of 16 779 small firms. Results provide empirical support for three propositions. Firstly, perceived dissatisfaction masks actual effects. Secondly, competitive conditions mediate regulatory effects; however, even resource-constrained firms reported few negative effects. Thirdly, informality eases regulatory impact. Results failed to confirm that older laws are ‘routinised’. Length of time as a business owner was found to be more influential than age of regulation, with owners who have been in business for many years having a longer ‘window of exposure’ increasing their likelihood of experiencing negative and positive effects.

Suggested Citation

  • Sara Carter & Colin Mason & Stephen Tagg, 2009. "Perceptions and Experience of Employment Regulation in UK Small Firms," Environment and Planning C, , vol. 27(2), pages 263-278, April.
    • Handle: RePEc:sae:envirc:v:27:y:2009:i:2:p:263-278
    DOI: 10.1068/c07106b
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    References listed on IDEAS

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    2. World Bank & International Finance Corporation, 2006. "Doing Business 2007 : How to Reform," World Bank Publications - Books, The World Bank Group, number 7245.
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