Public policies for private finance

Ralph De Haas and Juanita González-Uribe

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We review the literature on the effectiveness of public policies to facilitate firms’ access to finance. The rationale for such policies is to address market failures that cause financial constraints. Using a simple taxonomy, we discuss the current evidence on common interventions to tackle these constraints: public lending through state and development banks, public lending through private banks, subsidized credit, credit guarantee schemes, export credit agencies, publicly backed venture capital, and tax incentives for equity investors. Based on the quantity and quality of the available evidence, we summarize the policies that have proven most effective in helping firms access external financing. In addition, we highlight areas where future research is needed to address current knowledge gaps and to provide more definitive policy guidance.

Keywords: entrepreneurship; small business finance; public policy; financial constraints (search for similar items in EconPapers)
JEL-codes: G20 G28 H25 H81 (search for similar items in EconPapers)
Date: 2025-08-06
New Economics Papers: this item is included in nep-fdg and nep-sbm
References: Add references at CitEc
Citations:

Published in Annual Review of Financial Economics, 6, August, 2025. ISSN: 1941-1367

Downloads: (external link)
http://eprints.lse.ac.uk/129139/ Open access version. (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:129139

Access Statistics for this paper

More papers in LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library LSE Library Portugal Street London, WC2A 2HD, U.K.. Contact information at EDIRC.
Bibliographic data for series maintained by LSERO Manager ().