2015 Thumbtack SBFS Methodology

2015 Thumbtack.com Small Business Friendliness Survey:Methodology & Analysis

Jon LieberChief Economist, Thumbtack.com

[email protected]

Lucas Puente, PhDEconomic Analyst, Thumbtack.com

[email protected]

August 2015

Abstract

The 2015 Thumbtack.com Small Business Friendliness Survey polled over 17,000small business owner-operators from across the country on their policy preferences andevaluations of their state and local governments. With this survey data, we providethree novel contributions. First, we grade 36 states and 95 metropolitan regions on 11dimensions, ranging from overall business friendliness to more specific measures, like thefriendliness of an areas labor regulations. Second, we use econometric procedure knownas dominance analysis to determine what small businesses want most from their stateand local governments. This exercise revealed that providing helpful training programsis the single biggest determinant of small businessess evaluations of their state andlocal governments. Finally, we use regression analysis to determine how improvingalong different policy measures affects perceptions of overall friendliness. These resultsindicate that, among other things, requiring a service provider to hold a license is onlynegatively correlated with friendliness evaluations if that license is also seen as beingdifficult to comply with. With these results, we look forward to working with state andlocal officials to help improve policy conditions for small businesses across America.

1 Introduction

The Thumbtack.com Small Business Friendliness Survey is an annual, nationwide survey thatasks owner-operators of small businesses about the policy environment where they operate.The survey aims to learn what governments can do to create a healthy, vibrant local businessenvironment by asking the owner-operators of small businesses themselves about these issues.This year we use the survey data to grade 36 states and 95 metropolitan regions accordingto their performance along 11 metrics. This is the largest survey of its kind; so far as weknow, Thumbtack is the only organization in the United States that has had the necessaryaccess and motivation to produce such a large-scale survey of small businesses themselvesover the course of years.

This is the fourth annual release of the survey, which was originally developed with expertsfrom the Ewing Marion Kauffman Foundation.

Although the businesses that are surveyed by Thumbtack are small in size (90 percent have 5or fewer employees), the perceptions of the local business environment by these entrepreneursmatters for three reasons:

1. The United States is a service economy 80 percent of all workers today workin service industries.1 The view of service providers, even very small ones, is criticalto understanding the environment for job creation as employment in manufacturingcontinues its historical decline.

2. Entrepreneurship is a critical avenue for displaced workers research fromthe Kauffman Foundation shows that entrepreneurial activity tends to increase whenthe economy slows (Fairlee, 2014). The easier it is for an individual to start and runa business, the faster he or she can get back to work. As more American middle classjobs face the threat of automation and competition from overseas, self-employmentcould become a viable path to make a living for millions of Americans.

3. Entrepreneurship is on the decline government statistics show a general declineover the last 20 years in rates of self-employment and the rate of new business start-ups (Hathaway and Litan, 2014). This is happening across industries and across thecountry. Understanding how policy choices affect very small, new businesses is criticalto understanding how to turn the tide on this crisis of small business ownership.

Policies that are friendly towards self-employed entrepreneurs may act as a proxy for theregulatory climate for businesses generally states that did well in our survey have also seenhigher real output growth going back three years. As Figure 3 in Appendix D shows, stateswith higher friendliness scores have substantially higher growth rates than their less friendlycounterparts. The bivariate regression displayed in that figure also indicates that a one unitincrease in a states friendliness rating is associated with a jump in real economic growthper year of 27 basis points. Thats far from trivial since over 75% of states achieve annualgrowth of under 2.7%.

1The Department of Labor projects that 81 percent of workers will be in service industries by 2022(Henderson, 2013).

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There are many rankings and indices that designed to evaluate a particular city or statesappeal to business. The Thumbtack.com Small Business Friendliness Survey differs fromother such rankings in several meaningful ways:

1. The Thumbtack survey asks small business owners directly about their per-ceptions of their government many other studies of the same issue rely on theperceptions of the researcher to determine which factors make a political environmentfavorable or unfavorable.2 By prioritizing these other indices, policymakers may dolittle to improve conditions on the ground, at least in the eyes of small businesses(Motoyama and Hui, 2015).

2. The scale of the survey is nearly unprecedented this year we received over17,000 responses from small business owners in every state. Not only do few otheroutlets have the capability of asking that many entrepreneurs the same set of questionson a regular basis, few other outlets are able to break down the results of survey in aconsistent fashion across state and metro areas. In addition to the large sample, thescope of the survey, grading cities and states along 11 dimensions using a consistent setof questions over multiple years, captures some nuance that may otherwise be lost fromsimply looking at a handful of metrics and declaring an area friendly or unfriendly.

3. The survey is conducted with no preexisting agenda the purpose of the surveyis to present, without ideological bias, the views of the small business owners who useThumbtack. We are not pushing any particular agenda or advocating for any politicaloutcomes. Our goals are simply to understand what makes government work betterfor small businesses, according to their own beliefs.

2 Survey Design & Methodology

The data were collected over a period of two weeks.3 A link asking business owners oroperators to take the survey was provided to business users of Thumbtack.com after theyhad used the website to solicit business from potential consumers. Each of the 74,485 businessowners using the site during this time period was shown the prompt at least once, leadingto 17,633 completed responses, for a response rate of 24 percent. Roughly 1,500 incompleteresponses were thrown out.

The full text of the survey appears in Appendix A. Information on the demographic profileof survey respondents, including how they compare to business owners nationally, can befound in Appendix B. And full results for cities and states can be seen in Appendix C.

2For example, the Best Performing Cities ranking done by the Milken Institute relies entirely on outputssuch as which city saw the highest job or wage growth. The State Business Tax Climate Index (2014) bythe Tax Foundation relies only on the Tax Foundations view of what makes a friendly tax code and not onthe view of local businesses. These rankings, while interesting to review, show little correlation to each otherand may end up revealing very little about the actual experience of businesses that operate on the groundand the business environment (Fisher, 2005; Kolko et al., 2013).

3The results were gathered from December 2, 2014 to December 17, 2014.

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Generally, survey questions fall into one of three categories:

1. Questions 3 through 16 ask about a state or localitys friendliness towards small busi-ness.

(a) Respondents provided subjective rankings from very friendly to very unfriendlyon topics including state and local governments overall support of small busi-nesses, health insurance, regulations, training programs and online resources.

(b) Question 17 is a freeform question that provided the opportunity to give addi-tional information on business owners interactions with their governments. 6,734respondents answered this question.

2. Questions 18 through 22 ask about the situation of respondents businesses and generaleconomic conditions.

3. Questions 25 through 35 as about demographic information connected to each respon-dent and his/her business.

Because this is the fourth year of the survey and we have largely asked the same questionsover the years, we are able to assess how perceptions of the business climate in various citiesand states have changed over time.

To create the grades used for the cities and states in our survey, we converted the responseswe received into numerical scores for each question and averaged those scores in each categoryto create a numerical score for each city or state. Since nearly every question was based ona five-point scale, we assigned a score of 1 for answers that were very negative, 2 for answersthat were somewhat negative, 3 for neutral answers, 4 for answers that were somewhatpositive, and 5 for answers that were very positive.

We then computed weighted averages for each of the nine metrics that we observed directly,and two composite scores were computed one is our Overall Small Business FriendlinessScore,4 and the other is a composite score of the regulatory environment.5

The ranked and graded metrics are:

1. Overall small business friendliness

2. Ease of starting a small business

3. Ease of hiring a new employee

4. Overall regulatory friendliness

4The overall small business friendliness score was determined by combining the scores of three relatedquestions:

States: In general, how would you rate your state governments support of small business owners? Cities: In general, how would you rate your local (county, city, or town) governments support of

small business owners?

Would you discourage or encourage someone from starting a new business where you live? How difficult or easy is it to start a business where you live?

5This is a simple average of the state or citys scores for questions 5 10.

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5. Friendliness of health and safety regulations

6. Friendliness of employment, labor, and hiring regulations

7. Friendliness of tax code

8. Friendliness of licensing regulations

9. Friendliness of environmental regulations

10. Friendliness of zoning regulations

11. Availability of helpful training or networking programs

Grades were assigned based on a modified curve, with their performance depending on howfar they were from the average score along each metric. Any state more than 20 basis pointsabove the average was granted an A+, while any state less than 20 basis points below theaverage was given an F. Each grade in between represents a 4 basis points band betweenthese upper and lower bounds.

Cities where we received 30 or more responses were eligible for a grade, while states had toreceive at least 50 responses to receive a grade. We chose to use a higher threshold for statessince those with fewer than 50 responses were typically coming from a single metropolitanarea (e.g. Omaha, Nebraska). Thus, we chose to rank those cities rather than the statesthey are in.

3 Grading Results

For the fourth straight year, there is substantial geographic variation in the perceptions ofsmall business owners regarding the friendliness of their state and local governments. On oneend of the spectrum, survey respondents in Texas were the most likely to refer to their stategovernment as supportive, report that starting a business is easy, or recommend startinga new business. Those in New Hampshire and Utah were also quite likely to express suchpositive attitudes, earning these states the other two A+ grades we awarded this year. At theopposite end, small business owners in Rhode Island expressed the most negative attitudesabout their states policy environment. Small businesses in Illinois, Connecticut, Californiatended to feel relatively unsupported by their state governments as well, leading these fourstates to also receive a F grade.

On the city level, Texas was also quite successful, with four of the top ten coming fromthe Lone Star State: Dallas came in second, Austin fourth, Houston seventh, and SanAntonio tenth. However, the top spot went to Manchester, NH, the largest city in theGranite State. Other cities in the top ten included: Richmond, VA (#3), Knoxville, TN(#5), Fort Collins, CO (#8), and Boulder, CO (#9). On the bottom were Hartford, CT,Albuquerque, NM, Buffalo, NY, New Haven, CT, Winston-Salem, NC, and Providence, RI,all of which received an F grade. The state-level results are displayed in Figure 1 belowand in Table 1, while the city grades and ranks can be found in Table 2 (see Appendix

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C). Additionally, an interactive visualization of all the ratings is available at https://www.thumbtack.com/survey, while searchable and sortable tables are posted at https://www.thumbtack.com/blog/2015-results/.

Figure 1: Choropleth of Small Business Friendliness Ratings

4 Analytical Methodology

To determine what policy factors influenced these friendliness grades most, we conducted adominance analysis.6 The methodology behind this step is relatively straight-forward: usingthe domin package in Stata (Luchman, 2014a), a multivariate regression is run for eachpossible combination of independent variables to determine the proportionate contributioneach policy measure makes in explaining variation in the outcomes of interest: respondentsevaluations of the friendliness levels of their states (q3) and cities (q4).7

6For more background on this methodology, see Budescu and Azen (2004) and Johnson and LeBreton(2004).

7Since the dependent variable is measured on a five-point scale, we relied upon an ordinal logistic regressionas our workhorse econometric model. See Luchman (2014b) for a discussion of how to best use dominanceanalysis in the presence of multi-category dependent variables.

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Importantly, in each regression model, we account for potential confounding variables thatare both respondent-specific, such as an individuals race, gender, age of business, and ifthey are aligned with the dominant political party in their state, as well as others like thestrength of the economy in the respondents state at the time of the survey (both perceivedand actual). Since our dependent variables (friendliness evaluations) are perception-based,we also control for the overall level of happiness in each state.8 By including this full set ofcontrol variables, we are able to calculate the unique contribution of the 11 distinct policymeasures we ask about:

Health Regulations Labor Regulations Tax Regulations Licensing Regulations Environmental Regulations Zoning Regulations Tax Complexity Tax Fairness Government Website Licensing Compliance Training Opportunities

With the full sample of over 17,000 responses, we performed dominance analyses on boththe city and the state level to determine which policy measures matter most in those twodifferent jurisdictions.9 In addition, we ran dominance analyses for as many cities and statesas possible so we could learn what makes each of these cities and states unique from a policyprioritization perspective.

To complement this set of analyses, we also conducted a series of ordinal logistic regressions.The dependent variable was either the state or local friendliness rating for each individualresponse, scored on a level from 1 (very unfriendly) to 5 (very friendly). In the baselineequation we settled on (using various diagnostic techniques), the variables are the same asin the dominance analyses: the 11 policy measures, plus the full set of control variables. Toaccount for possible intra-state correlation that isnt accounted for by the variables in theregression, we cluster the standard errors by state.10

8State-specific happiness scores come from Mitchell et al. (2013).9Since our survey did not require answers to all questions, some respondents left some questions blank.

Since diagnostics deemed the data to be missing at random, we were reluctant to rely solely on completeresponses as doing so may have delivered biased results. Instead, we employed multiple imputation 25 timesto generate a more comprehensive dataset. More a review of this crucial pre-analysis step in applied surveyresearch, see Rubin (2004).

10This relaxes the standard requirement that all observations in a given state are independent.

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5 Analytical Results

Thumbtacks survey has consistently shown that the most important factors to small busi-nesses are training and networking opportunities offered by a local government, and thefriendliness of complying with regulatory burdens, including, most importantly, the tax rulesand licensing laws. This year, the dominance and regression analyses offered simple conclu-sions on the national level. Highlighting this, we found that training is the most importantdeterminant of friendliness evaluations on both the state and local level. Similarly, for bothstates and cities, regulatory burdens, led by those surrounding licensing and employment,were among the most important drivers of friendliness ratings.

This year we also dug more deeply into several aspects of the survey that we had not examinedpreviously. We found that:

What matters at the city level differs from the state level although for bothcities and states, offering training and networking programs is the single most importantvariable that informs overall friendliness, for cities ease of licensing compliance was thesecond most important factor, and for states, ease of tax compliance was the secondmost important factor.

Tax rates are less important than regulatory complexity for both cities andstates, tax rates still matter far less than either tax-related regulations or the burdenof complying with licensing regulations.

Licensing is not black and white respondents who werent required to have alicense judged their cities and states in a more favorable light; however, respondentswho said complying with licensing rules was very easy were just as favorable towardstheir governments as respondents who werent required to have a license at all.

When the job market heats up, ease of hiring matters more labor rules havebecome more important as the economy has rebounded and the unemployment ratehas dropped. This is particularly true on the state level, as business owners becomemuch less likely to evaluate their state government as very supportive when theyalso report that labor and employment regulations are either somewhat or veryunfriendly.

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Appendix A: Thumbtack Business Friendliness Survey

Questions

2015 Thumbtack Business Friendliness Survey

Thanks for participating in the Thumbtack Business Friendliness Survey!

This survey should take 5-8 minutes to complete.

This survey was developed in partnership between Thumbtack and the Ewing Marion Kauff-man Foundation and seeks to provide insight into the friendliness of state and local govern-ments towards small businesses.

The results of this survey will be used by Thumbtack and the Kauffman Foundation toprovide policymakers and researchers with valuable information on how small businesses feelabout their state and local governments.

Individual responses to the survey will not be released outside of Thumbtack and the Kauff-man Foundation, and all publicly released analysis of the surveys results will reflect onlyaggregate results.

Thanks again.

1. In which state do you primarily operate your business?

2. Which of the following best describes your business? 90% of my sales are made tocustomers...

Within 10 miles of my companys primary location. Within 25 miles of my companys primary location. Within 50 miles of my companys primary location. Within 100 miles of my companys primary location. More than 100 miles from my companys primary location.

3. In general, how would you rate your state governments support of small businessowners?

Very supportive Somewhat supportive Neither supportive nor unsupportive Somewhat unsupportive Very unsupportive

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4. In general, how would you rate your local (county, city, or town) governments supportof small business owners?

Very supportive Somewhat supportive Neither supportive nor unsupportive Somewhat unsupportive Very unsupportive

5. Would you discourage or encourage someone from starting a new business where youlive?

Highly encourage Somewhat encourage Neither encourage nor discourage Somewhat discourage Highly discourage

6. How difficult or easy is it to start a business where you live?

Very easy Somewhat easy Neither easy nor difficult Somewhat difficult Very difficult

7. How difficult or easy is it to obtain and keep health insurance at your business?


8. How difficult or easy is it to hire a new employee at your business?

Very easy Somewhat easy Neither easy nor difficult Somewhat difficult

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Very difficult9. How unfriendly or friendly is your state or local government with regard to the following

types of regulations:

Veryfriendly

Somewhatfriendly

Neitherfriendly norunfriendly

Somewhatunfriendly

Veryunfriendly

Does notapply to

my businessHealth andsafetyregulations

Employment,labor andhiringregulations

Tax code andtax-relatedregulations

Licensingforms,requirementsand fees

Environmentalregulations

10. Does your profession require that you have a license, certification, or permit to do yourjob?

Yes No

10a. How difficult or easy is it to comply with the licensing, certification, or permittingrequirements of your profession?


10b. Which of the following types of agencies require that you have a license, certification,or permit to do your job?

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None One More than oneCity, town, or other municipal agency County agency State agency Federal agency

10c. How poorly or well enforced are the licensing, certification, or permitting requirementsof your profession?

Very well enforced Somewhat well enforced Neither well enforced nor poorly enforced Somewhat poorly enforced Very poorly enforced

11. How difficult or easy is it to understand and file your businesss taxes?


12. Do you think you pay your fair share of taxes?

I pay an unfairly high level of taxes I pay the right share of taxes I pay an unfairly low level of taxes

13. Does your state or local government offer helpful training or networking programs forsmall business owners?

Yes No I dont know

13a. How helpful do you believe the training or networking programs offered by your stateor local government are?

Very helpful

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Somewhat helpful Neither helpful or unhelpful Somewhat unhelpful Very unhelpful

14. Which entity are you most likely to turn to if you wanted to learn more about runningyour business?

Local Chamber of Commerce or another business association A local government entity A state entity Local chapter of SCORE or the Small Business Administrations Small Business

Development Centers

Other:15. Have you used a state or local government website to comply with regulations on your

business (examples: starting your business, filing taxes, getting a license or permit,etc.)?

Yes No

15a. How difficult or easy was it to use the website(s)?


16. How helpful or disruptive has implementation of the Patient Protection and AffordableCare Act (Obamacare) been for your business?

It has helped me and my employees obtain health insurance with minimal disrup-tion to my business

It has helped me and my employees obtain health insurance but was very disrup-tive to my business

It was disruptive to my business and has not helped me and my employees obtainhealth insurance

It was neither disruptive nor helpful to my business or my employees

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17. Please let us know any experiences or thoughts you have regarding the ease of doingbusiness where you live.

18. Would you be willing to be quoted in the press about your views on doing businesswhere you live?

Yes No

18a. Great - whats your name?

18b. And your email address?

18c. And your profession?

19. Over the past 12 months, did your companys revenues:

Increase a lot Increase a little Stay the same Decrease a little Decrease a lot

20. How do you expect the number of employees at your company to change in the next12 months?

Increase a lot Increase a little Stay the same Decrease a little Decrease a lot

21. How would you rate the situation of the national economy over the past 12 months?

Very good Somewhat good Neither good nor bad Somewhat bad Very bad

22. How would you rate the situation of your state economy in comparison to the nationaleconomy?

Substantially better

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A little better The same A little worse Substantially worse

23. Thinking specifically about the economy, what issue should be the top priority of yourstate or local government? Choose One:

Budge deficit / spending Financial and banking system Gas / fuel prices Health care costs Home values and the housing market Inflation / rising prices Personal debt Social Security Student loans Taxes Unemployment and the job market Other No opinion

24. Thinking specifically about the economy, what issue should be the top priority of thefederal government? Choose One:

Federal budget deficit Financial and banking system Gas / fuel prices Health care costs Home values and the housing market Inflation / rising prices Personal debt Social Security Student loans Taxes

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Unemployment and the job market Other No opinion

25. How long has your business been operating?

Less than 1 year 1-2 years 3-4 years 5 or more years

26. How many people does your business employ?

1 I work alone at my business 2-5 6-10 11-20 21-50 51-100 101 or more

27. What type of company is your business?

Unincorporated or sole proprietorship Limited liability company (LLC) Partnership (LP, LLP, GP) S-Corporation C-Corporation I dont know

28. Have you ever been an entrepreneur prior to your current company?

Yes No

29. Is this business your primary employment, or is it a side job?

Primary employment Side job, hobby, or secondary income

30. What is your gender?

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Female Male

31. What is your age?

25-34 35-44 45-54 55-64 65 or above

32. What is your political preference?

Strong conservative Lean conservative Independent Lean liberal/progressive Strong liberal/progressive Other

33. What is the highest level of education you have reached?

No high school High school Community college Technical college Undergraduate degree Masters degree Doctoral degree

34. What is your race or origin?

White (Caucasian) Hispanic, Latino, or Spanish Black or African American Asian Other

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35. Are you currently serving or have you ever served on active duty in the US ArmedForces, military Reserves, or National Guard?

Yes, I am an active duty member of the US Armed forces Yes, I currently serve in the military Reserves or the National Guard Yes, I previously served on active duty in the US Armed Forces, military Reserves,

or National Guard but I am now a civilian

No, I have never served on active duty in the US Armed Forces, military Reserves,or National Guard

36. Would you like us to email you the results of the survey?

Yes No

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Appendix B: Survey Population

The sample of businesses included in this survey is concentrated in the professional andnonprofessional services sector. In comparison, 81% percent of American small businessesare in a service industry.11

NAICSCode

NAICS Category% of

AllFirms

% ofService

Firms

% ofRespondents

in Survey

11Agriculture, Forestry,Fishing and Hunting

0.9%

21Mining, Quarrying,and Oil and Gas Extraction

0.5%

22 Utilities 0.1% 23 Construction 9.9% 10.6% 16.1%

31-33 Manufacturing 2.1% 0.2%42 Wholesale Trade 2.7%

44-45 Retail Trade 9.8% 10.5% 0.5%

48-49Transportationand Warehousing

4.2% 4.5% 1.6%

51 Information 1.5% 1.6% 1.3%52 Finance and Insurance 4.0% 4.2% 0.03%

53Real Estate andRental and Leasing

9.1% 9.7% 1.1%

54Professional, Scientific,and Technical Services

13.5% 14.4% 19.6%

55Management of Companiesand Enterprises

0.2%

56Administrative and Support andWaste Managementand Remediation Services

7.9% 8.5% 16.8%

61 Educational Services 2.3% 2.5% 8.4%62 Health Care and Social Assistance 9.2% 9.8% 4.4%71 Arts, Entertainment, and Recreation 4.5% 4.8% 5.8%72 Accommodation and Food Services 3.3% 3.6% 4.7%

81Other Services(except Public Administration)

14.1% 15.1% 19.6%

99 Industries not classified 0.0%

All firms percentages calculated from 2012 Census data. Non-employer data come from the Non-Employer

Statistics data series found at http://www.census.gov/econ/nonemployer/; employer data comes from the

County Business Patterns found at http://www.census.gov/econ/cbp/. See the methodological notes at

the Non-Employer data series for why the County Business Patterns data series was chosen.

11Here, we define small businesses as firms with fewer than 20 employees or non-employer establishments.

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The sample comes from a wide range of American business owners that captures much of thediversity of American businesses across geographic, racial and ethnic, gender, educational,firm age, and firm size metrics. We believe the survey can therefore provide very useful datafor states and localities trying to determine what they can do better to make themselvesfriendlier to small service businesses.

GenderBusinessesNationally

ThumbtackSurvey Businesses

Female 28.8% 37.8%Male 51.3% 62.2%

Age of Business OwnerUnder 25 2.1% 3.7%25-34 10.3% 21.6%35-44 20.9% 26.3%45-54 29.1% 26.2%55-64 23.6% 17.6%65 or above 12.3% 4.7%

Race or OriginAsian 5.7% 2.4%Black or African American 7.1% 11.4%Hispanic, Latino, or Spanish 9.2% 10%Other 1.3% 6.5%White (Caucasian) 83.4% 69.8%

The responses to our survey paralleled closely the geographic density of small businesses inthe country as reported by the US Census Bureau (see Figure 2 to get a sense of where ourresponses came from).12 The response rates of only four states varied from their expectedresponse rates by more than 1%, and New York was the only state to vary by more than2%.13

12Census Bureau data available at http://www.census.gov/econ/nonemployer/ and http://www.census.gov/econ/susb/. Currently, the most recent Census data available is from 2012.

13New York was under-sampled in this years survey by 2.25 percentage points, given its share of small,service-based businesses according to the Census numbers. This pattern is consistent with previous SmallBusiness Friendliness surveys.

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Figure 2: Percent of Responses by State

We also compared the age and size of the businesses in our survey with those of the generalbusiness population. Both revealed that the Thumbtack survey sample has a similar distri-bution to the American small business community in terms of age and size with a slight biastowards younger businesses and a general exclusion of the largest-size businesses.

Firm Age National Average Thumbtack FirmsLess than 1 year 8% 21%1-2 years 11% 19%3-4 years 10% 15%5 or more years 70% 45%

According to US Census data, 75% of service businesses are non-employer firms.14 57% ofsmall businesses in the Thumbtack sample reported having no employees. A breakdown inthe percent of employer businesses by size is provided below.15

Number of employees All Firms Thumbtack firmsNone 75% 57%1-4 13% 34%5-9 5% 5%10-19 3% 2%20-49 2% 1%50+ 1% 1%

14Non-employer statistics are available at http://censtats.census.gov/cgi-bin/nonemployer/nonsect.pl, accessed 5/27/14.

15All data on employment size of US businesses comes from the Statistics of US Businesses program runby the US Census bureau, http://www.sba.gov/advocacy/849/12162#susb and http://www.sba.gov/sites/default/files/static_us_11_0.xlsx, accessed 4/14/14.

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Appendix C: Ranks & GradesTable 1: States

OverallFriendlinessRank/Grade

Ease ofStarting aBusiness

Ease ofHiring

OverallRegulations

Health &Safety

Employment,Labor &Hiring

TaxCode

LicensingEnviron-mental

ZoningTraining &Networking

Alabama 17 B 26 C+ 2 A 16 B 16 B 14 B+ 24 C 15 B+ 17 B 6 A+ 28 D+Arizona 22 B- 22 B- 11 B 21 B 19 B- 23 C+ 19 B 17 B 20 B 14 B+ 24 C-California 33 F 34 F 22 C 34 F 34 D+ 34 F 33 F 34 F 35 F 31 D+ 26 C-Colorado 5 A 5 A+ 24 C 24 C+ 28 C 20 B- 23 C+ 19 B 25 C+ 24 C 7 AConnecticut 34 F 29 D+ 30 C- 35 F 36 F 36 F 35 F 29 C- 36 F 35 F 36 FFlorida 21 B- 25 C+ 23 C 17 B 13 B 17 B 7 A 21 B- 16 B 22 B- 21 CGeorgia 9 A 8 A 13 B 14 B+ 17 B 12 B+ 14 B+ 13 B+ 13 B+ 13 B+ 20 C+Idaho 6 A 2 A+ 31 C- 11 B+ 9 A- 15 B+ 8 A 10 A 12 B+ 21 B- 2 A+Illinois 35 F 33 F 28 C- 33 D 35 D 35 F 34 F 35 F 26 C 29 C- 27 D+Indiana 13 B+ 17 B 26 C 10 A- 14 B 10 A- 15 B+ 14 B+ 9 A- 9 A- 13 B+Iowa 27 C+ 31 D 36 F 2 A+ 6 A 5 A+ 6 A+ 5 A+ 1 A+ 1 A+ 25 C-Kansas 10 A 6 A+ 1 A+ 1 A+ 2 A+ 1 A+ 1 A+ 1 A+ 3 A+ 5 A+ 34 FKentucky 24 C+ 15 A- 6 A- 15 B 12 B 16 B 17 B 24 C+ 11 A- 11 B+ 22 CLouisiana 4 A 9 A 15 B 5 A+ 3 A+ 2 A+ 13 A- 2 A+ 2 A+ 20 B- 12 B+Maryland 31 D+ 27 C 16 B- 31 D 30 C- 28 C- 30 D 31 D 34 F 34 F 8 A-Massachusetts 30 D+ 30 D 21 C+ 32 D 32 D+ 32 D 32 F 33 F 32 D 32 D 29 D+Michigan 20 B- 21 B- 18 B- 23 B- 25 C+ 22 C+ 22 C+ 22 B- 19 B 18 B 14 BMinnesota 25 C+ 14 A- 32 C- 30 D+ 33 D+ 29 D+ 31 F 32 D 31 D+ 25 C 9 A-Missouri 16 B 11 A- 20 C+ 18 B 10 A- 18 B 16 B+ 20 B- 18 B 19 B- 32 FNevada 14 B 12 A- 25 C 12 B+ 18 B 24 C+ 3 A+ 25 C 7 A 4 A+ 23 CNew Hampshire 2 A+ 1 A+ 19 C+ 13 B+ 21 B- 21 B- 4 A+ 3 A+ 21 B- 17 B 17 B-New Jersey 29 C- 32 D 14 B 28 C- 29 C- 26 C 28 D+ 30 D+ 29 C- 30 D+ 35 FNew York 32 D 35 F 17 B- 25 C 24 C+ 25 C 26 C- 28 C 24 C+ 28 C- 18 B-North Carolina 23 B- 24 C+ 9 B+ 20 B 20 B- 11 B+ 20 B- 16 B 22 B- 15 B+ 15 BOhio 15 B 18 B 29 C- 19 B 15 B 13 B+ 21 B- 18 B 15 B+ 16 B+ 11 A-Oklahoma 12 A- 4 A+ 4 A 8 A 7 A 7 A+ 11 A- 6 A+ 10 A- 12 B+ 19 C+Oregon 18 B 20 B- 34 D 26 C 23 C+ 30 D+ 25 C- 27 C 27 C- 26 C- 1 A+Pennsylvania 28 C- 28 C- 27 C- 29 D+ 31 D+ 27 C- 29 D 26 C 30 C- 33 D 31 D+Rhode Island 36 F 36 F 7 A- 36 F 22 C+ 33 D 36 F 36 F 33 D 36 F 16 B-South Carolina 11 A 19 B 8 A- 4 A+ 1 A+ 3 A+ 5 A+ 7 A+ 8 A 7 A 5 ATennessee 7 A 10 A- 12 B 9 A- 11 B+ 8 A 10 A 8 A+ 14 B+ 8 A 33 FTexas 1 A+ 3 A+ 10 B 3 A+ 4 A 6 A+ 2 A+ 4 A+ 6 A 3 A+ 6 AUtah 3 A+ 16 B 3 A 6 A+ 8 A 4 A+ 12 A- 11 A- 4 A+ 2 A+ 3 A+Virginia 8 A 7 A+ 5 A- 7 A 5 A 9 A 9 A 9 A+ 5 A+ 10 B+ 10 A-Washington 26 C+ 13 A- 33 C- 27 C- 27 C 31 D+ 27 D+ 23 C+ 28 C- 27 C- 4 A+Wisconsin 19 B- 23 B- 35 F 22 B- 26 C+ 19 B- 18 B 12 A- 23 C+ 23 C+ 30 D+

21

Table 2: Cities



Ease ofHiring

OverallRegulations

Health &Safety


TaxCode



Akron, OH 36 B 29 B+ 84 C- 24 B+ 6 A 34 B 41 B 28 B+ 18 A- 25 B+ 22 A-Albany, NY 88 D 78 D+ 83 C- 71 C 81 C- 92 F 83 D 67 C 20 B+ 24 B+ 31 B+Albuquerque, NM 94 F 73 D+ 48 B- 78 C- 92 F 81 D+ 68 C- 89 D 46 B- 63 C 88 FAllentown, PA 74 C- 54 C+ 89 D+ 92 F 91 F 86 D 93 F 88 D 89 D 83 D+ 94 FAnaheim, CA 75 C- 69 C 26 B 81 D+ 72 C 82 D 78 D+ 78 D+ 84 D+ 77 C- 53 C+Ann Arbor, MI 44 B- 60 C+ 48 B- 19 B+ 43 B- 35 B 4 A+ 37 B 68 C 3 A+ 10 A+Asheville, NC 67 C 68 C 7 A 58 C+ 66 C+ 61 C+ 57 C+ 58 C+ 31 B 64 C 44 B-Atlanta, GA 20 B+ 22 A- 45 B- 28 B 39 B 32 B 33 B+ 29 B+ 22 B+ 28 B+ 41 B-Austin, TX 4 A+ 9 A+ 43 B- 36 B 44 B- 50 B- 23 A- 40 B 36 B 48 B- 8 A+Baltimore, MD 86 D+ 66 C 54 C+ 88 D 80 C- 78 C- 84 D 92 F 90 F 90 F 34 BBirmingham, AL 16 A- 20 A- 1 A+ 11 A 8 A 5 A+ 35 B 19 A- 21 B+ 7 A+ 73 C-Boise, ID 18 B+ 8 A+ 47 B- 54 C+ 21 B+ 60 C+ 48 B- 49 B- 60 C+ 79 D+ 12 A+Boston, MA 72 C 77 D+ 56 C+ 79 C- 84 D+ 75 C- 70 C- 76 D+ 78 C- 84 D+ 76 C-Boulder, CO 9 A 13 A+ 65 C 51 B- 32 B 44 B- 44 B- 34 B 42 B- 89 D 39 B-Bridgeport, CT 48 B- 51 C+ 34 B 64 C 77 C- 84 D 60 C+ 42 B 61 C+ 46 B- 93 FBuffalo, NY 93 F 86 D+ 87 D+ 82 D+ 68 C+ 89 F 85 D 83 D+ 62 C+ 82 D+ 19 ACamden, NJ 79 C- 94 F 13 A- 69 C 58 C+ 42 B- 53 B- 87 D 58 C+ 86 D+ 86 DCape Coral, FL 61 C+ 65 C 71 C 50 B- 56 C+ 56 B- 29 B+ 50 B- 64 C+ 58 C+ 6 A+Charleston, SC 30 B+ 47 B- 18 B+ 22 B+ 9 A 12 A 22 A- 33 B 40 B 35 B- 2 A+Charlotte, NC 51 B- 40 B 57 C+ 49 B- 61 C+ 40 B 47 B- 64 C+ 47 B- 34 B- 64 CChicago, IL 83 C- 81 D+ 52 C+ 83 D+ 87 D+ 80 D+ 82 D 90 F 67 C 72 C- 68 C-Cincinnati, OH 41 B- 35 B+ 90 D+ 16 A- 17 A- 18 A 45 B- 20 A- 5 A 13 A 78 D+Cleveland, OH 62 C+ 67 C 63 C 59 C+ 55 C+ 57 C+ 61 C+ 66 C 49 B- 51 C+ 14 AColorado Springs, CO 29 B+ 6 A+ 46 B- 68 C 85 D+ 71 C 74 D+ 52 B- 55 B- 36 B- 51 C+Columbia, SC 19 B+ 19 A- 6 A+ 8 A 5 A 4 A+ 26 B+ 9 A+ 12 A 4 A+ 20 A-Columbus, OH 15 A- 14 A 59 C+ 35 B 45 B- 26 B+ 43 B 46 B- 32 B 39 B- 5 A+Dallas, TX 2 A+ 7 A+ 20 B+ 2 A+ 4 A+ 1 A+ 3 A+ 5 A+ 4 A+ 6 A+ 23 A-Dayton, OH 40 B- 48 B- 85 D+ 41 B- 62 C+ 37 B 46 B- 16 A 76 C- 27 B+ 77 C-Denver, CO 25 B+ 23 A- 64 C 47 B- 64 C+ 45 B- 49 B- 39 B 59 C+ 40 B- 25 B+Detroit, MI 24 B+ 34 B+ 40 B- 55 C+ 57 C+ 43 B- 54 C+ 62 C+ 53 B- 52 C+ 42 B-Durham, NC 14 A- 58 C+ 8 A 15 A- 27 B 6 A+ 5 A+ 14 A 25 B+ 47 B- 3 A+Fort Collins, CO 8 A 17 A 80 C- 53 B- 51 B- 38 B 37 B 31 B+ 63 C+ 87 D 1 A+Fort Lauderdale, FL 59 C+ 57 C+ 55 C+ 44 B- 36 B 41 B- 39 B 61 C+ 38 B 57 C+ 56 C+Fort Worth, TX 12 A- 20 A- 51 B- 21 B+ 28 B 25 B+ 15 A 15 A 35 B 30 B 62 CGrand Rapids, MI 49 B- 82 D+ 74 C- 1 A+ 2 A+ 16 A 1 A+ 2 A+ 1 A+ 1 A+ 13 A+Greensboro, NC 26 B+ 24 A- 10 A 29 B 38 B 13 A 51 B- 24 B+ 69 C 15 A- 80 D+

22

Table 2: Cities (continued)



Ease ofHiring

OverallRegulations

Health &Safety


TaxCode



Greenville, SC 27 B+ 16 A 30 B 40 B 50 B- 20 A- 31 B+ 45 B- 65 C+ 49 C+ 40 B-Hartford, CT 95 F 74 D+ 95 F 95 F 95 F 95 F 87 F 95 F 95 F 93 F 69 C-Honolulu, HI 63 C 88 D 91 D 77 C- 69 C 91 F 75 D+ 55 B- 79 C- 76 C- 24 A-Houston, TX 7 A+ 4 A+ 19 B+ 6 A+ 10 A 11 A 6 A+ 10 A+ 13 A- 8 A+ 26 B+Indianapolis, IN 21 B+ 26 A- 72 C 17 A- 20 B+ 22 A- 25 A- 30 B+ 15 A- 14 A 15 AJacksonville, FL 32 B 36 B 66 C 39 B 35 B 54 B- 21 A- 36 B 43 B- 60 C+ 36 BKansas City, MO 22 B+ 12 A+ 28 B 20 B+ 23 B+ 29 B+ 20 A- 18 A- 19 B+ 32 B 87 FKnoxville, TN 5 A+ 1 A+ 17 A- 4 A+ 7 A 2 A+ 13 A 4 A+ 8 A 2 A+ 84 DLancaster, PA 33 B 30 B+ 82 C- 87 D+ 74 C 85 D 66 C 77 D+ 83 D+ 94 F 9 A+Las Vegas, NV 53 C+ 39 B 58 C+ 42 B- 63 C+ 58 C+ 18 A- 70 C- 24 B+ 23 B+ 74 C-Lawrence, MA 73 C- 87 D 68 C 91 D 86 D+ 87 D 92 F 91 F 86 D+ 88 D 32 BLos Angeles, CA 81 C- 84 D+ 35 B 67 C 67 C+ 64 C 63 C 68 C 73 C 59 C+ 75 C-Louisville, KY 35 B 53 C+ 22 B+ 43 B- 37 B 23 B+ 30 B+ 71 C- 29 B+ 66 C 11 A+Manchester, NH 1 A+ 2 A+ 15 A- 3 A+ 14 A- 19 A- 2 A+ 1 A+ 6 A 5 A+ 28 B+Memphis, TN 57 C+ 64 C 67 C 13 A- 30 B 15 A 14 A 7 A+ 25 B+ 11 A+ 92 FMiami, FL 58 C+ 85 D+ 23 B 30 B 42 B- 31 B 32 B+ 54 B- 17 A- 26 B+ 70 C-Milwaukee, WI 52 B- 41 B 73 C 57 C+ 71 C 59 C+ 42 B 26 B+ 74 C 62 C+ 49 C+Minneapolis, MN 38 B- 18 A- 70 C 76 C- 73 C 69 C 76 D+ 73 C- 75 C- 68 C 21 A-Nashville, TN 6 A+ 11 A+ 16 A- 14 A- 18 B+ 23 B+ 12 A 12 A 16 A- 17 A- 71 C-New Haven, CT 92 F 93 F 37 B 70 C 52 B- 62 C+ 91 F 25 B+ 71 C 70 C 91 FNew Orleans, LA 34 B 37 B 24 B 25 B+ 12 A- 9 A+ 58 C+ 27 B+ 2 A+ 79 D+ 29 B+New York, NY 76 C- 92 F 25 B 33 B 25 B 28 B+ 36 B 41 B 33 B 45 B- 35 BNewark, NJ 43 B- 55 C+ 32 B 52 B- 47 B- 48 B- 55 C+ 56 B- 48 B- 54 C+ 72 C-Oakland, CA 77 C- 83 D+ 86 D+ 73 C 53 C+ 63 C 80 D 74 C- 70 C 61 C+ 52 C+Oklahoma City, OK 11 A- 3 A+ 11 A 5 A+ 3 A+ 3 A+ 11 A+ 2 A+ 14 A- 16 A- 47 C+Omaha, NE 31 B 28 A- 4 A+ 31 B 59 C+ 17 A 34 B 11 A 34 B 78 D+ 81 D+Orlando, FL 39 B- 49 B- 38 B 26 B+ 24 B+ 36 B 19 A- 32 B+ 27 B+ 29 B+ 85 DOxnard, CA 78 C- 71 C- 69 C 93 F 94 F 93 F 89 F 94 F 91 F 92 F 82 D+Philadelphia, PA 68 C 70 C- 27 B 56 C+ 65 C+ 33 B 59 C+ 42 B 57 C+ 65 C 54 C+Phoenix, AZ 42 B- 45 B- 33 B 37 B 40 B 51 B- 38 B 38 B 41 B 33 B 59 CPittsburgh, PA 65 C 42 B- 88 D+ 66 C 70 C 72 C 69 C- 65 C 56 B- 56 C+ 63 CPort St. Lucie, FL 69 C 76 D+ 39 B- 27 B 10 A 46 B- 28 B+ 59 C+ 29 B+ 21 A- 57 CPortland, OR 37 B 44 B- 81 C- 62 C+ 48 B- 73 C- 64 C 63 C+ 66 C+ 42 B- 16 AProvidence, RI 90 F 90 D 21 B+ 75 C- 31 B 66 C 77 D+ 82 D+ 80 C- 81 D+ 37 BRaleigh, NC 23 B+ 32 B+ 5 A+ 18 B+ 26 B 21 A- 24 A- 17 A 28 B+ 22 B+ 30 B+Richmond, VA 3 A+ 5 A+ 2 A+ 7 A+ 1 A+ 7 A+ 10 A+ 8 A+ 11 A 19 A- 4 A+Riverside, CA 80 C- 80 D+ 60 C+ 90 D 89 D 88 F 90 F 85 D 92 F 75 C- 43 B-

23

Table 2: Cities (continued)



Ease ofHiring

OverallRegulations

Health &Safety


TaxCode



Rochester, NY 84 D+ 79 D+ 53 C+ 84 D+ 78 C- 83 D 88 F 86 D 85 D+ 44 B- 38 B-Sacramento, CA 85 D+ 89 D 92 D 94 F 93 F 94 F 94 F 93 F 93 F 91 F 58 CSalt Lake City, UT 13 A- 27 A- 9 A 12 A- 15 A- 14 A 27 B+ 22 A- 10 A 9 A+ 33 BSan Antonio, TX 10 A 25 A- 44 B- 10 A 16 A- 10 A+ 9 A+ 13 A 9 A 10 A+ 7 A+San Diego, CA 89 D 91 F 77 C- 80 D+ 79 C- 77 C- 79 D 69 C 88 D 74 C- 66 CSan Francisco, CA 66 C 72 D+ 48 B- 65 C 22 B+ 68 C 72 C- 75 C- 45 B- 73 C- 65 CSan Jose, CA 64 C 62 C+ 62 C 72 C 75 C 79 D+ 67 C 72 C- 72 C 36 B- 89 FSanta Rosa, CA 55 C+ 75 D+ 76 C- 45 B- 29 B 52 B- 52 B- 79 D+ 7 A 43 B- 27 B+Sarasota, FL 28 B+ 38 B 36 B 38 B 34 B 55 B- 7 A+ 51 B- 52 B- 69 C 60 CSeattle, WA 47 B- 15 A 42 B- 61 C+ 60 C+ 76 C- 65 C 35 B 54 B- 55 C+ 18 ASpringfield, MA 87 D+ 59 C+ 12 A- 85 D+ 88 D+ 89 F 81 D 84 D+ 82 D+ 50 C+ 90 FSt. Louis, MO 60 C+ 56 C+ 75 C- 48 B- 33 B 49 B- 50 B- 60 C+ 51 B- 53 C+ 83 D+Syracuse, NY 82 C- 31 B+ 3 A+ 89 D 90 D 65 C 95 F 21 A- 94 F 95 F 79 D+Tacoma, WA 71 C 52 C+ 79 C- 86 D+ 82 C- 70 C 86 F 81 D+ 87 D 85 D+ 55 C+Tampa, FL 54 C+ 63 C+ 78 C- 34 B 41 B- 30 B 17 A- 47 B- 50 B- 41 B- 46 B-Tucson, AZ 70 C 61 C+ 29 B 32 B 49 B- 47 B- 40 B 23 B+ 44 B- 20 A- 61 CTulsa, OK 56 C+ 33 B+ 41 B- 60 C+ 76 C 39 B 62 C+ 57 C+ 37 B 67 C 48 C+Virginia Beach, VA 17 A- 10 A+ 14 A- 9 A 13 A- 8 A+ 16 A- 6 A+ 3 A+ 18 A- 50 C+Washington, DC 46 B- 46 B- 31 B 46 B- 46 B- 53 B- 56 C+ 53 B- 39 B 38 B- 17 AWest Palm Beach, FL 45 B- 43 B- 61 C 23 B+ 19 B+ 27 B+ 8 A+ 48 B- 23 B+ 31 B 45 B-Winston-Salem, NC 91 F 95 F 94 D 63 C+ 83 C- 74 C- 71 C- 44 B 81 C- 12 A 95 FWorcester, MA 50 B- 50 C+ 93 D 74 C- 54 C+ 67 C 73 D+ 80 D+ 76 C- 71 C 67 C-

24

6 Appendix D: Full Analytical Results

Figure 3: Relationship Between Friendliness Scores & State Growth Rates

25

Table 5: Dominance Analysis: Local Support

Rank Type Dominance Score1 Training Opportunities 0.01922 Set of Controls 0.01193 Licensing Regulations 0.01084 Government Website 0.00995 Tax Regulations 0.00976 Health Regulations 0.00967 Labor Regulations 0.00948 Zoning Regulations 0.00819 Environmental Regulations 0.0073

10 Tax Fairness 0.006911 Licensing Compliance 0.006712 Tax Complexity 0.0053

Table 6: Dominance Analysis: State Support

Rank Variable Dominance Score1 Set of Controls 0.02702 Training Opportunities 0.01603 Tax Regulations 0.01464 Labor Regulations 0.01405 Licensing Regulations 0.01236 Government Website 0.01137 Health Regulations 0.01108 Environmental Regulations 0.00879 Zoning Regulations 0.0075

10 Tax Fairness 0.007411 Licensing Compliance 0.006812 Tax Complexity 0.0061

26

Table 7: Ordinal Logistic Regression Results

Dependent Variable: Local Support State Support

RegulatoryFriendliness

Heath & Safety 0.161*** 0.132***(0.0323) (0.0304)

Employment, Labor & Hiring 0.0957*** 0.176***(0.0347) (0.0326)

Tax Code & Tax-Related Regulations 0.0837*** 0.172***(0.0276) (0.0312)

Licensing Forms, Requirements & Fees 0.152*** 0.141***(0.0283) (0.0286)

Environmental 0.0158 0.0595**(0.0284) (0.0288)

Zoning 0.0901*** -0.0126(0.0260) (0.0248)

TaxComplexity

Ease of Understanding The Tax Code 0.0928*** 0.104***(0.0168) (0.0183)

Perception ofTax Burden(Baseline = PayRight Amount)

Pay Excessive Amount -0.202*** -0.252***(0.0334) (0.0315)

Pay Insufficient Amount -0.561*** -0.517***(0.149) (0.161)

GovernmentWebsite(Baseline =None)

Very Difficult -0.429*** -0.556***(0.144) (0.144)

Somewhat difficult -0.0761 -0.0685(0.0470) (0.0536)

Neither easy nor difficult -0.110** -0.0228(0.0453) (0.0564)

Somewhat easy 0.140*** 0.204***(0.0307) (0.0367)

Very easy 0.234*** 0.330***(0.0607) (0.0673)

TrainingOpportunities(Baseline =None)

Unhelpful 0.205 0.0704(0.178) (0.194)

Neither helpful or unhelpful 0.219*** 0.217***(0.0689) (0.0611)

Helpful 0.780*** 0.677***(0.0391) (0.0478)

LicensingCompliance(Baseline =None)

Very Difficult -0.556*** -0.513***(0.164) (0.130)

Difficult -0.126** -0.149**(0.0595) (0.0712)

Standard -0.0753 -0.0388(0.0679) (0.0616)

Easy -0.0452 -0.0354(0.0549) (0.0503)

Very Easy 0.102* 0.0263(0.0544) (0.0649)

27

Table 7: Ordinal Logistic Regression Results (Continued)

ControlVariables

Company Revenue 0.0645*** 0.0465***(0.0151) (0.0151)

Perception of State Economy 0.175*** 0.248***(0.0211) (0.0204)

State Unemployment Rate -0.0499** -0.117***(0.0255) (0.0352)

Business Age -0.0609*** -0.0605***(0.0141) (0.0111)

State Happiness Level -0.616 -0.767(0.532) (0.639)

Political Contiguity 0.146*** 0.293***(0.0439) (0.0500)

Female 0.0608* -0.0437(0.0352) (0.0433)

Race(Baseline =White)

Asian -0.0296 0.0825(0.138) (0.120)

Black -0.125** 0.0940(0.0491) (0.0594)

Hispanic -0.0479 0.0630(0.0515) (0.0548)

Other -0.0646 -0.0457(0.0626) (0.0900)

Constants

Cut 1 -4.409 -5.065(3.250) (3.861)

Cut 2 -3.094 -3.745(3.247) (3.859)

Cut 3 -1.329 -1.877(3.244) (3.863)

Cut 4 0.741 0.333(3.250) (3.872)

Observations 17,164 17,215Robust standard errors, clustered by state, in parentheses.*** p

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