The Impact of COVID-19 on Small Businesses in the US: A Longitudinal Study from a Regional Perspective

Abstract

Small businesses have suffered disproportionately from the COVID-19 pandemic. We use near-real-time weekly data from the Small Business Pulse Survey (April 26, 2020 - June 17, 2021) to examine the constantly changing impact of COVID-19 on small businesses across the United States. A set of multilevel models for change are adopted to model the trajectories of the various kinds of impact as perceived by business owners (subjective) and those recorded for business operations (objective), providing insights into regional resilience from a small business perspective. The findings reveal spatially uneven and varied trajectories in both the subjectively and the objectively assessed impact of COVID-19 across the U.S., and the different responses to the pandemic shock can be explained by evolving health situations and public policies, as well as by the economic structure and degree of socioeconomic vulnerability in different areas. This study contributes to scholarship on small businesses and regional resilience, as well as identifying policies and practices that build economic resilience and regional development under conditions of global pandemic disruption.

Entrepreneurial Resilience During COVID-19: The Survival of Small Businesses Using Dynamic Capabilities Theory and Effectuation Theory

“…Comprehending the crucially transformed context amid the health pandemic is vital for small businesses in light of significant societal changes (Kang & Wang, 2023). While global economies grapple with financial challenges, developed nations generally exhibit more resilience in the face of pandemics.…”

Monetary Transmission & Small Firm Credit Rationing Stable-Coin Configuration Opportunities to Raise Small Firm Credit Flows

“…"Credit rationing" arises from information asymmetry [35], regulatory constraint and a lack of available asset collateral [36]. Basel bank regulations constrain, (especially smaller), firm lending flows, even if an individual firm's default risk is lower than normal [37].…”

Credit Availability for Minority Business Owners in an Evolving Credit Environment

“…Using the small fraction of PPP loans where the race of the owner was identified, Atkins et al (2022) showed that Black-owned firms received loans that were roughly half the size of White-owned firms. Several other papers have explored the role of banks, fintech, and automation in racial disparities in PPP loan outcomes using SBA data, but the limited application information on borrowers and the generally poor quality of the SBA data leave much of the reported differentials unexplained (Battisto et al, 2021; Erel & Liebersohn, 2022; Howell et al, 2022; Kang & Wang, 2022). Chernenko et al (2022) examined the PPP loan application patterns in the SBCS in more detail, which allowed them to examine both the application and the approval processes.…”