TY - JOUR
T1 - Evaluation of credit guarantee policy using propensity score matching
AU - Oh, Inha
AU - Lee, Jeong Dong
AU - Heshmati, Almas
AU - Choi, Gyoung Gyu
PY - 2009/9
Y1 - 2009/9
N2 - In this article, we evaluate the effect of the credit guarantee policy by comparing a large sample of guaranteed firms and matched non-guaranteed firms from 2000 to 2003. The sample firms are compared with respect to growth rates of different performance indicators including: productivity, sales, employment, investment, R&D, wage level, and the survival of firms in the post crisis period. In order to avoid the selectivity problem, propensity score matching methodologies are adopted. Results suggest that credit guarantees influenced significantly firms' ability to maintain their size, and increase their survival rate, but not to increase their R&D and investment and hence, their growth in productivity. Moreover, due to the adverse selection problem, firms with lower productivity were receiving guarantees.
AB - In this article, we evaluate the effect of the credit guarantee policy by comparing a large sample of guaranteed firms and matched non-guaranteed firms from 2000 to 2003. The sample firms are compared with respect to growth rates of different performance indicators including: productivity, sales, employment, investment, R&D, wage level, and the survival of firms in the post crisis period. In order to avoid the selectivity problem, propensity score matching methodologies are adopted. Results suggest that credit guarantees influenced significantly firms' ability to maintain their size, and increase their survival rate, but not to increase their R&D and investment and hence, their growth in productivity. Moreover, due to the adverse selection problem, firms with lower productivity were receiving guarantees.
KW - Credit guarantee
KW - Propensity score matching
KW - Selection bias
KW - SME
UR - http://www.scopus.com/inward/record.url?scp=70350618342&partnerID=8YFLogxK
U2 - 10.1007/s11187-008-9102-5
DO - 10.1007/s11187-008-9102-5
M3 - Article
AN - SCOPUS:70350618342
SN - 0921-898X
VL - 33
SP - 335
EP - 351
JO - Small Business Economics
JF - Small Business Economics
IS - 3
ER -