Has the Paycheck Protection Program Succeeded?

Glenn Hubbard and Michael Strain
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Glenn Hubbard: Columbia University

Brookings Papers on Economic Activity, 2020, vol. 51, issue 3 (Fall), 335-390

Abstract: Enacted March 27, 2020, the Paycheck Protection Program (PPP) was the most ambitious and creative fiscal policy response to the pandemic recession in the United States. PPP offers forgivable loans - essentially grants - to businesses with 500 or fewer employees that meet certain requirements. In this paper, we present evidence that PPP has substantially increased the employment, financial health, and survival of small businesses, using data from Dun & Bradstreet, Inc. We use event studies and standard differencein-differences models to estimate the effect of a small business applying for larger PPP loans and of a small business being eligible for PPP based on size. While our findings are informative, we believe it is too early to issue conclusive judgment on PPP's success. We offer lessons for the future from the PPP experience thus far.

Keywords: COVID-19; Paycheck Protection Program; fiscal policy; business (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (6)

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Working Paper: Has the Paycheck Protection Program Succeeded? (2020)
Working Paper: Has the Paycheck Protection Program Succeeded? (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:bin:bpeajo:v:51:y:2020:i:2020-03:p:335-390

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