Covid-19, Fiscal Policies, and Small-and-Medium-Sized Firm Survival: Evidence From the Cross-Country Matching Analysis

Abstract

Objective The present study examines the effect of fiscal policies on firm survival for small-and-medium-sized enterprises in the cross-country level firm-level data. Research Design A propensity score matching analysis is utilised for the post-COVID-19 period firms by using the World Bank Enterprise Follow-up Surveys for the pandemic period. Small-and-medium-sized enterprises are essential to the economy; firm failures can increase in a pandemic. Results The obtained findings show that the effect of fiscal policies has an essential effect on small-and-medium-sized enterprises survival in the COVID-19 pandemic period by using a cross-country heterogenous firm-level sample. Conclusions In this context, the present study shed new light on the link between COVID-19-related fiscal policies and small-and-medium-sized firm survival in developing countries.

The impact of COVID-19 on firm risk and performance in MENA countries: Does national governance quality matter?

“…The revenue of firms reduced significantly during the COVID-19 crisis period. Several firms in MENA countries had to close down due to lockdowns, making it difficult for them to pay their debts as well as increase loans due to a serious lack of capital [ 63 ]. Moreover, the COVID-19 crisis led to banks in MENA countries increasing capital ratio [ 64 ], making it further difficult for firms in this region to access bank capital, leading to increased risks.…”