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Why Americans Love Small Business The latest studies show consumers are willing to pay more to buy from a small business than a big one. Here's a look at five reasons why Americans are rooting for entrepreneurs.

By Scott Shane Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

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Small business may be the most popular institution in America. According to a 2012 poll conducted on behalf of the Public Affairs Council, 88 percent of Americans view small business favorably. In fact, 68 percent of us would rather pay more to do business with a small business than a big one. Could America's love of small business help broker a deal between Republicans and Democrats in Congress?

Related: 10 Questions to Ask Before Quitting Your Job to Start a Business

Few institutions can compete with small business in the eyes of Americans. A 2010 Pew Foundation survey found that Americans view small business more positively than they perceive churches and universities.

Small business's favorability is remarkably stable. Gallup Organization polls in both 2010 and 2012 reported 95 percent positive views of small business among Americans.

Why do Americans love small business? Five reasons jump out from all the studies and surveys.

1. Small business owners are the embodiment of the American dream.
Americans like the gumption it takes to invest one's life savings to follow the dream of starting a company. We are, after all, supposed to be a nation of go-getting, risk takers living in the land of opportunity.

2. Americans love the idea that big companies come from tiny ones.
While studies show that few small businesses actually grow, and only a sliver of entrepreneurs want to do more than start a little company, virtually all big companies started small. As a nation, we love the idea that oak trees come from acorns.

3. Small business is the underdog and Americans root for the underdog.
Small business owners work more hours and make less money than the rest of us, according to the Pew Foundation. They face competition from deep pocketed big companies who -- according to the perception of a significant minority of Americans -- sometimes use unfair tactics to compete, a Public Affairs Council survey found.

4. Small business owners are seen as honest and ethical.
Only 8 percent of Americans think the CEOs of major corporations are highly ethical, but 52 percent who view small business owners as such, according to the Public Affairs Council survey.

5. Small business is seen as the backbone of a middle class way of life.
When asked who should get credit for supporting the middle class over the last half century, 51 percent of Americans picked small business -- more than double the amount that chose labor unions, big companies or the federal government.

Most Americans believe small business owners are America's job creators. A July 2012, Rasmussen survey found that 57 percent of American voters think small business owners create more jobs and generate more economic growth than either big businesses or the government.

Related: The Ethics Coach on How to Maintain the Integrity of Your Brand

Perhaps small business's popularity can bridge the political divide that has paralyzed Washington. Unlike capitalism itself, small business is perceived positively by both Democrats and Republicans alike. A 2012 Gallup survey found that while nearly three times as many Democrats as Republicans view the federal government favorably, and nearly twice as many Republicans as Democrats see big business in a positive light, 95 percent of Republicans and 94 percent of Democrats have a positive view of small business.

Note to Washington: Why don't you focus on policies that help small business generate good will between the parties?

Related: Why Consumer Credit Matters to Small Businesses (Opinion)

Scott Shane

Professor at Case Western Reserve University

Scott Shane is the A. Malachi Mixon III professor of entrepreneurial studies at Case Western Reserve University. His books include Illusions of Entrepreneurship: The Costly Myths That Entrepreneurs, Investors, and Policy Makers Live by (Yale University Press, 2008) and Finding Fertile Ground: Identifying Extraordinary Opportunities for New Businesses (Pearson Prentice Hall, 2005).

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