[Klaus23]

The businesses wouldn't go away. They would just move to less densely populated areas.

Businesses would perhaps take a small efficiency hit because of the reduced availability of labour in the region, but even this would probably be compensated for by better worker mobility, because businesses would be less crowded in the cities and there would be more labour available in the low-density areas.

Businesses would probably also be able to pay a little less as less income is tied up in housing costs. A restructuring of business and population distribution would probably not have that much impact on overall productivity, but it could shift the available money between income levels significantly. If less money goes to rich property owners, then more money stays with the average person.