A History of Small Business in America grew out Mansel Blackford's concern that historians had underestimated the importance of small firms in American economic and social life. The first edition (New York: Twayne Publishers, 1991) came out at a time when big business had faltered and some scholars had pinned America's economic revitalization on small firms. While small firms have not proven to be the engines of growth and innovation their champions had predicted—Blackford admits as much in the second edition—they remain vital components of a rich and diverse national economy and, therefore, deserve scrutiny. Blackford skillfully documents the changing fortunes of small business in the United States over the past two centuries. He explores the strategies small firms employed to remain competitive in an economy increasingly dominated by large firms, evaluates the impact of government policies on small business, and considers the role and meaning of small business in American culture.

While retaining the chronological structure of the first edition, the second edition incorporates short case studies on retail booksellers, specialty steel producers, a vertically integrated seafood company, and Maui's unsuccessful attempt to launch its own version of Silicon Valley. Blackford divides his history of small business into five periods. Prior to the 1880s, the U.S. economy consisted almost exclusively of small farmers, merchants, artisans, and small manufacturers. A distinction between small and large businesses emerged in the 1880s, as large concerns came to dominate the economic scene. Small business began to cluster in pockets of the economy uninhabited by larger concerns. They remained of central importance in the retail, service, and agricultural sectors. In manufacturing, small firms remained viable by adopting flexible production techniques to produce specialty items for niche markets and by banding together in industrial districts. Between 1921 and the end of World War II, big business made gains in agriculture, sales, and manufacturing. Although some small businesses joined forces to promote protective legislation, those that continued to prosper did so by pursuing opportunities in niche markets and avoiding head-to-head competition with large firms. The story of the postwar period for small business was similarly one of declension, with protective legislation ultimately failing to halt the advance of big business into all corners of the national economy. Only in the last three decades of the twentieth century, as big business faltered in the face of international competition, did small business witness a modest resurgence. Yet, as Blackford notes, small business became more dependent on large firms as subcontracting arrangements proliferated and big businesses adapted to the global upheaval by becoming more nimble and flexible.

Blackford draws upon a handful of groundbreaking monographs published in the 1990s to expand his discussion of small business ownership among women, African-Americans, and immigrants. Although ownership rates have been lower among minorities than whites historically, small business has served as a means of independence and economic advancement for groups excluded from or on the fringes of the corporate workforce. Female ownership of small businesses has increased over the years, even as barriers to corporate employment have lowered. Blackford's discussion of government policies is sharper than in the first edition, largely as a result of new research completed in the past decade on the Small Business Administration and on the impact of federal laws on small and large firms. All three branches of government enter the story as complex and powerful institutions that have shaped the business environment in ways that have both helped and hindered small firms at different points in time. Short sections dispersed throughout the book on the history of small business in Europe and Asia, furthermore, provide ample opportunity for drawing comparisons and placing American developments in a broader international context.

The two mantras of the book are that small businesses have survived by exploiting market niches through flexible production and marketing strategies and that small business has been important in America for more than just economic reasons. Small business owners, according to Blackford, have occupied a special place in the American imagination. Long admired for their self-reliance and independence, small business owners were depicted during the Cold War as bastions “of political as well as economic democracy” (p. 4). Worthy of further scrutiny is Blackford's claim that independence has been as important as economic gain as a motivation for striking out on one's own. His assertion that most small business owners have sought “a reasonable income,” rather than riches and rapid growth, appears to be a fairly safe claim to make, but it tends to obscure differences among businesses and denies change over time (p. 203). I was also disappointed that Blackford did not at least mention vice industries, such as gambling and the sex trade, which faced the same challenges, including as encroachment from large firms, and developed the same strategies, including niche marketing and clustering, as other small businesses.

Readers of the first edition will notice certain improvements in format. The type in the second edition is easier on the eyes, the chapter “additional reading” lists are an improvement over the selected bibliography format, and the removal of certain charts and graphs improves the flow of the text. Yet, the detailed and copious endnotes of the first edition have vanished. If not for the “additional reading” lists and occasional references to specific books and authors in the text, nonspecialists and novice readers would have no way of determining the sources of certain quotations and ideas. The lack of endnotes seriously detracts from this otherwise excellent survey.