The economic and social benefits of the government-backed credit guarantee fund under the condition of an economic downturn

摘要

In this study, we seek to explain how to achieve more positive externalities though public guarantee schemes, which are currently very popular among policymakers, as the number of countries implementing this policy illustrates. With empirical evidence on high-tech enterprises supported by government-backed credit guarantee funds in Taizhou, China, we propose a series of new understandings of the economic and social benefits of the government-backed credit guarantee scheme. The results confirm that bank credit does not promote enterprises to produce more economic and social benefits. However, government-backed credit guarantee funds are conducive to enterprises producing more economic benefits while their impacts on the enterprises? social benefits are not clear. The heterogeneity in guarantee intensities is incorporated into the model by constructing random parameter logit models with panel data.