Economic development in a pandemic: Reflections from Melbourne, ‘the world's most locked-down city'

This paper explores the key principles of economic development in a pandemic. It does so by drawing on the lessons learned through the economic response to the COVID-19 pandemic in the Australian city of Melbourne. Melburnians experienced 263 days largely confined to their homes, one of the longest lockdown periods in the world, resulting in deserted city streets and a devastated central city economy. The experience forced the City of Melbourne to adopt a range of unique and innovative responses, first to keep businesses afloat during lockdown, and then to reactivate the city. Melbourne did this while keeping a focus on longer-term economic development. This somewhat unique experience makes Melbourne a useful case study informing best-practice economic development in a pandemic. Key lessons emerging from Melbourne's experience include the need to respond and iterate rapidly, the importance of collaboration with stakeholders and other tiers of government, and the need to maintain a focus on multiple time horizons, even in the midst of the crisis. These insights are potentially transferrable to economic development responses to other crises, including those catalysed by climate change. © 2023, Henry Stewart Publications. All rights reserved.

Determinants and effects of the use of COVID-19 business support programs in Japan

Using a survey of and financial data for Japanese small- and medium-enterprises (SMEs), this paper examines the determinants of firms' use of the business support programs provided by the Japanese government during the COVID-19 pandemic and their effect. With respect to the determinants, we obtain the following three findings: First, firms were more likely to have obtained subsidized loans, grants, or subsidies the more their sales had fallen during the pandemic, suggesting that funds flowed to firms that were adversely affected by the pandemic. Second, the likelihood that firms obtained funds was higher if their credit scores were lower or if they were classified as "zombies” and/or "low-return borrowers” before the pandemic, suggesting that the government programs also helped firms that had been under-performing before the pandemic. Third, firms were more likely to receive funds if they had a stronger relationship with their main bank before, suggesting that bank relationships play an important role in firms' access to government programs. Regarding the causal effects, we obtain the following three findings: First, except for the subsidies for employment adjustment, the support programs increased the cash holdings of user firms. Second, subsidized loans from private financial institutions lowered exit rates, while none of the programs had a significantly positive effect on employment relative to non-users (or in absolute terms). Third, the credit scores and profit-to-sales ratio of firms that used the support programs decreased and the likelihood of such firms being a zombie and/or a low-return borrower increased. Overall, our findings provide a cautionary tale in that the business support programs produced mixed results in that they may have prevented business failures but have also helped to prop up firms that are not viable in the long run. © 2022 Elsevier Inc.

Determinants and Effects of the Use of COVID-19 Business Support Programs in Japan

Using a survey of and financial data for Japanese small- and medium-enterprises (SMEs), this paper examines the determinants of firms’ use of the business support programs provided by the Japanese government during the COVID-19 pandemic and their effect. With respect to the determinants, we obtain the following three findings: First, firms were more likely to have obtained subsidized loans, grants, or subsidies the more their sales had fallen during the pandemic, suggesting that funds flowed to firms that were adversely affected by the pandemic. Second, the likelihood that firms obtained funds was higher if their credit scores were lower or if they were classified as “zombies” and/or “low-return borrowers” before the pandemic, suggesting that the government programs also helped firms that had been under-performing before the pandemic. Third, firms were more likely to receive funds if they had a stronger relationship with their main bank before, suggesting that bank relationships play an important role in firms’ access to government programs. Regarding the causal effects, we obtain the following three findings: First, except for the subsidies for employment adjustment, the support programs increased the cash holdings of user firms. Second, subsidized loans from private financial institutions lowered exit rates, while none of the programs had a significantly positive effect on employment relative to non-users (or in absolute terms). Third, the credit scores and profit-to-sales ratio of firms that used the support programs decreased and the likelihood of such firms being a zombie and/or a low-return borrower increased. Overall, our findings provide a cautionary tale in that the business support programs produced mixed results in that they may have prevented business failures but have also helped to prop up firms that are not viable in the long run.

The Government Business Support Strategies, Micro SMEs and Covid-19 Pandemic

The COVID-19 pandemic, also known as the coronavirus pandemic is today regarded as one of the largest global public health crisis. The pandemic has not only endangered people’s lives, but has also jammed economic outputs of many countries the world over. As a result, different economic levels in various parts of the world have experienced a massive direct impact as a result of COVID-19. Small and medium enterprises (SMEs), in particular, had taken the worst blow, and the sectors of SMEs badly affected by this ongoing public health crisis include transportation, tourism, and food services, as well as accommodation. Government intervention is henceforth becoming increasingly important amidst the current extraordinary circumstance and are certainly required to be more comprehensive and unconventional than usual. In order to minimize the negative effects of the pandemic on SMEs, which are a vital organ of a nation’s economy, a comprehensive and creative form of assistance is therefore urgently needed to save them. Hence, this study aims to identify priority assistance programs most needed by SMEs. Besides, this study also examines how the assistance programs launched by the government match the actual needs of SMEs. Last but not least, this study also explores SMEs’ ability to survive the current crisis, in particular, by measuring their capacity to survive from possible risks of insolvency. Notably, this study finds that the role of government in supporting the growth of micro SMEs is becoming increasingly important and critical. Micro SMEs support programs therefore must be comprehensive and not focused on financial support programs alone. Advisory services and trainings, especially in the field of e-commerce and social media need to be made more accessible to micro SMEs. Undeniably, skills in the digital economy and social media are added values and offer great convenience for entrepreneurs to market their products more widely today. In essence, the findings of this study support policymakers in their efforts to improve current policies and at the same time, formulate new strategies related to the use of e-commerce for micro SMEs. Finally, the study also suggests that future researches incorporate more contextual variables into this study model and investigate those variables in more diverse geographical or cultural environments, thus revealing other relationships necessary to maintain the sustainability of micro SMEs. © 2022, The Author(s), under exclusive license to Springer Nature Switzerland AG.

Anti-Crisis Programs to Stimulate the Economy in the Context of Destructive Globalization Processes

Purpose: The purpose of the study is to evaluate programs and measures of anti-crisis regulation. The viral factors of the crisis (COVID-19) will strengthen its economic consequences. The results and influencing factors of the current crisis will prove more difficult for the global economy and most of the national economies of the world. The consequences of the current crisis will be more devastating than after the global financial and economic crisis of 2008–2009, therefore, the process of eliminating these consequences will take some time. Design/methodology/approach: The article proposes methods and tools for developing the concept of anti-crisis socio-economic policy, which, firstly, would provide support to national companies, industries and citizens, and, secondly, would contribute to formation of a new business model aimed at the recovery growth of the economy. Findings: The paper identifies the main factors of the savings model of economic behavior of companies and households in conditions of uncertainty. A comparative characterization of new anti-crisis measures applied by governments of different countries with previous forms of harmonized global regulation of the economy was carried out. Originality/value: It was concluded that the main influence on the growth of imbalances is the restriction of demand and the reduction of production of products that are used for subsequent stages of production. To reduce global risks, it is important not only to provide classic financial support to national businesses, but also to create and organize effective cooperation between the fiscal and monetary authorities of developed countries. © 2022, The Author(s), under exclusive license to Springer Nature Switzerland AG.

ENSURING ECONOMIC STABILITY IN UKRAINE UNDER COVID-19 PANDEMY CONDIOTIONS: ONGOING ISSUES AND IMPROVEMENT PERSPECTIVE

Paper offers a look at the problems of ensuring economic stability in Ukraine in the context of the COVID-19 pandemic. A thorough analysis of research papers from developed and developing countries is performed in terms of socio-economic consequences of the coronacrisis and ways to increase economic stability in the context of the COVID-19 pandemic. The key drivers of the corona-crisis and its impact on the world economy in general and Ukraine in particular are considered. The major socio-economic consequences of the COVID-19 pandemic are highlighted. Examples of measures implemented by governments around the world to restore economic stability in the context of the COVID-19 pandemic are presented. Paper's special focus is on causation in the development of corona-crisis. Emphasis is placed on the atypical course of the corona-crisis in comparison with the << traditional >> financial and socio-economic crises. The peculiarities of the governments' measures around the world under corona-crisis conditions are presented, with a special focus on the levers of social support and digitalization. The best practices for overcoming the negative socio-economic consequences of the COVID-19 pandemic, aimed at strengthening economic stability, are summarized. Examples of measures of social support and digitalization in the context of overcoming the negative consequences of the corona-crisis are given. A review of a set of measures taken by the Government of Ukraine is performed, aimed at strengthening the economic stability of Ukraine. Relevant decisions on overcoming the negative socio-economic consequences of the corona-crisis are highlighted, with a special focus on Ukrainian peculiarities. Potential risk areas of financial and socio-economic nature in the context of the corona-crisis in Ukraine are identified, based on the peculiarities of Ukraine's national economy. Priority areas for the Government of Ukraine measures in the context of socio-economic consequences due to the COVID-19 pandemic are identified. Authors' view of measures in terms of social support and digitalization in Ukraine are presented. Authors emphasize on maintaining a balance between measures aimed at containing COVID-19 spread and measures aimed at stimulating economic growth.

ADVISORY SERVICES TO SMALL AND MEDIUM-SIZED ENTERPRISES DURING THE COVID-19 VIRUS PANDEMIC

The complete shutdown of economic activity during March, April and May 2020 was aimed to prevent the further spread of the COVID-19 virus and prevent a collapse of the health system in the Republic of Croatia. The virus pandemic, as well as the economic consequences of the crisis caused by the pandemic, posed a new challenge for all commercial entities, especially the small and medium-sized enterprise (SME) sector, which, during the last financial crisis in 2008, was also in a much more unfavourable position compared to large enterprises. Entrepreneurship Development Strategy of the Republic of Croatia 2013-2020 defines the role of entrepreneurship support institutions, which includes the provision of advisory assistance. Since 2010, when there were 88, the number of business support institutions has grown to 473 institutions, as of November 20, 2020. Such a network of institutions, whose work is co-financed by budget funds, makes their services available to all economic entities. On the other side of the market of advisory and consulting services, there are private initiatives (business entities engaged in this activity), whose services and work are not co-financed from the state budget. The aim of this paper is to examine how and to what extent entrepreneurship support institutions truly support the SME sector, especially in times of crisis, and how much they monitor their needs. The paper compares the offer of both types of institutions and analyses the extent to which the offer was in line with the needs of the SME sector during crisis caused by pandemic. Data were collected through primary research (interviews with representatives of 4 business support institutions and 4 representatives of private consulting companies) and secondary research (an overview of the services offered on official websites of all business support institutions). Research results indicate a lack of timely support of business support institutions in the form of innovative products and services that would be tailored for entrepreneurs affected by the crisis. At the same time, private consulting firms demonstrated speed and flexibility and promptly approached clients from the SME sector and offered them appropriate service and support. Concluding remarks of the paper indicate a reduction in the capacity of business support institutions for entrepreneurial activity (proactive and innovative) whose causes should be sought in the sources of funding, and almost complete orientation towards EU projects which, with their longer period of preparation and implementation, reduce the sensitivity of entrepreneurship support institutions to problems of those to whom, according to their mission, they should primarily be focused.