Naslov
The impact of state guarantees on trends in small and medium-sized enterprises in eastern Croatia

Autori
Becker, Goran ; Broz, Tanja ; Ridzak, Tomislav

Vrsta, podvrsta i kategorija rada
Radovi u zbornicima skupova, cjeloviti rad (in extenso), znanstveni

Izvornik
Economy of Eastern Croatia – Vision and Growth / Mašek Tonković, Anka - Osijek : Sveučilište Josipa Jurja Strossmayera u Osijeku ; Ekonomski fakultet Sveučilišta Josipa Jurja Strossmayera u Osijeku, 2016, 101-112

Skup
5th International Scientific Symposium Economy of Eastern Croatia - Vision and Growth

Mjesto i datum
Osijek, Hrvatska, 02.06.2016. - 04.06.2016

Vrsta sudjelovanja
Predavanje

Vrsta recenzije
Međunarodna recenzija

Ključne riječi
Guarantee schemes; SMEs; employment growth; facilitated access to finance; eastern Croatia

Sažetak
Credit guarantee schemes have become a popular instrument for policy makers. They are aimed at increasing access to lending, especially for small and medium-sized enterprises, because the absence of adequate collateral is often high barrier for viable project to get funded. However, little has been known about the effectiveness of these schemes. Hence, the question whether public guarantees are justified for the purpose of SME’s facilitated access to finance is the topic of many economic discussions. A challenging task for many companies is exactly the access to finance. However, these financing constraints tend to be more difficult for SMEs to overcome than for larger firms (OECD, 2012). SMEs face less access to debt capital they need, especially in the start-up phase, to further operation and growth (Riding and Haines, 2001). Credit guarantee schemes can be seen as filling this gap, since they are aimed at the SME sector, by simultaneously cushioning their risks and enhancing the credit approval from business banks (Levitsky, 1997). In fact, the restrictions posed by business banks in evaluation of SMEs are primarily a high risk exposure, insufficient entrepreneurial capitalization and inadequate collaterals, which all represent a weight in the SMEs’ start-up and growth phase. The main purpose of this article is to investigate whether state-funded guarantee schemes impact the firm performance in terms of job creation and sales by facilitating the access to finance. The analysis has a regional approach, focusing on developments in eastern Croatia. Results show that companies that received guarantees perform better than the Croatian average in terms of employment and sales growth. However, more analysis is needed, especially analysis focused on the activated guarantees. Data on activation could change our results significantly.

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

POVEZANOST RADA