The effects of policy funds on the financing constraints of small- and medium-sized enterprises in South Korea. Issue 10 (7th June 2017)

• Record Type: Journal Article
• Authors: Hahn, Sang B.; Kwon, Sehoon; Yun, Jeongsun
• Is Part Of: Applied economics letters. Volume 24:Issue 10(2017)
• Page Start: 699
• Page End: 702
• Publication Date: 2017-06-07
• Subjects: Financing constraints -- investment-cash flow sensitivity -- SME financing -- SME policy funds; G2 -- G3; Economics -- Periodicals; Economics, Mathematical -- Periodicals; 330
• DOI: 10.1080/13504851.2016.1223804
• Languages: English
• ISSNs: 1350-4851

Abstract

ABSTRACT: This study investigates whether small- and medium-sized enterprises (SMEs) policy funds in South Korea are effective in reducing financing constraints faced by the SMEs. We find that investment-cash flow sensitivity decreases after public loans are granted, and furthermore that this decrease in the sensitivity is greater for younger and smaller firms. These results are consistent with the certification effects hypothesis.