Author: Christopher Neilson
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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The Paycheck Protection Program (PPP) extended 669 billion dollars of forgivable loans in an unprecedented effort to support small businesses affected by the COVID-19 crisis. This paper provides evidence that information frictions and the "first-come, first-served" design of the PPP program skewed its resources towards larger firms and may have permanently reduced its effectiveness. Using new daily survey data on small businesses in the U.S., we show that the smallest businesses were less aware of the PPP and less likely to apply. If they did apply, the smallest businesses applied later, faced longer processing times, and were less likely to have their application approved. These frictions may have mattered, as businesses that received aid report fewer layoffs, higher employment, and improved expectations about the future.
Author: Chris Pilkerton
Publisher: Post Hill Press
ISBN:
Category : Political Science
Languages : en
Pages : 123
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Book Description
“We were in absolute crisis, and we were risking a major, major meltdown of financial conditions, economic conditions and health conditions simultaneously.” —Steven Mnuchin, Secretary of the US Treasury, September 2020 “We packed months of legislative process into five days.” —US Senator Charles Schumer, March 2020 “Be fast, have no regrets. You must be the first mover. The virus will always get you if you don’t move quickly.” —Dr. Michael Ryan, World Health Organization/epidemiologist, March 2020 ____________________________________________ In early 2020, the American economy was roaring. Unemployment was historically low, and small business optimism was on the rise. And then the coronavirus changed everything. Lockdowns, massive unemployment claims, and small business closures spread throughout the country. Those who could do so worked from their homes, virtually educating their children and trying to maintain some sense of normalcy for their families. All they could do was watch the news as the media reported that millions of Americans were infected with the virus, and that many would ultimately lose their lives to complications associated with the disease. Along Main Streets across the country, the dreams of countless entrepreneurs faced permanent ruin; their hopes hung in the balance in the halls of Congress and within the walls of the Oval Office. The CARES Act was passed and signed into law in March 2020, with a price tag of over $2 trillion. Small businesses and their workers relied on various programs, including the now famed Paycheck Protection Program, which ultimately sought to inject $800 billion into the US economy. This is the story of that time, and what the world learned about the resilience of the entrepreneur. In Plandemic, former US Small Business Administration Acting Administrator and White House Senior Policy Advisor Chris Pilkerton contends that when the next pandemic hits, policymakers must be prepared with a focused action plan to support the economic engine of the United States of America: small business.
Author: R. Glenn Hubbard
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
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 the Dun & Bradstreet Corporation. We use event studies and standard difference-in-difference 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.
Author: João Granja
Publisher:
ISBN:
Category : COVID-19 (Disease)
Languages : en
Pages : 41
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Book Description
This paper takes an early look at the Paycheck Protection Program (PPP), a large and novel small business support program that was part of the initial policy response to the COVID-19 pandemic. We use new data on the distribution of PPP loans and high-frequency micro-level employment data to consider two dimensions of program targeting. First, we do not find evidence that funds flowed to areas more adversely affected by the economic effects of the pandemic, as measured by declines in hours worked or business shutdowns. If anything, funds flowed to areas less hard hit. Second, we find significant heterogeneity across banks in terms of disbursing PPP funds, which does not only reflect differences in underlying loan demand. The top-4 banks alone account for 36% of total pre-policy small business loans, but disbursed less than 3% of all PPP loans. Areas that were significantly more exposed to low-PPP banks received much lower loan allocations. As data become available, we will study employment and establishment responses to the program and the impact of PPP support on the economic recovery. Measuring these responses is critical for evaluating the social insurance value of the PPP and similar policies.
Author: Mark E. Schweitzer
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Author: Allegra Hobbs
Publisher:
ISBN: 9781529752014
Category : COVID-19 (Disease)
Languages : en
Pages :
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Book Description
This case covers the U.S. Congress's Paycheck Protection Program (PPP), which was meant to provide funding for small businesses struggling under lockdown. Through a per-location loophole, however, major funds were allocated to large corporate chains, leaving small businesses without a safety net and the public wondering whom the PPP was intended to help.
Author: David Autor
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Author: Rajib Bhattacharyya
Publisher: Springer Nature
ISBN: 9819944058
Category : Business & Economics
Languages : en
Pages : 356
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Book Description
The book intends to capture the most critical issue that has cropped up as an aftermath of the Corona pandemic- the phenomenon of widening of global inequalities across nations depending upon their economic position, support policies of the government and international relationship particularly in the context of alarming growth of unemployed in the labour market, business activity and social sector. This book is expected to provide new areas of research to both academicians and policy makers to re-think about global cooperation for bridging the inequalities for a better world. It tries to incorporate the valuable contribution of experts from various fields of knowledge in a consolidated volume. This text will be revised once the chapters are finalized and put together in structured themes. The table of content lists some of the chapters that have been confirmed, but there are more that are being invited by the editors.
Author: Susan C. Morse
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
The Paycheck Protection Program, or PPP, was huge. Between April 2020 and May 2021, it provided almost $800 billion to more than 11 million businesses--about a third of all U.S. businesses with 500 employees or fewer. The PPP was also flawed. Treasury and the Small Business Administration faced incomplete statutory instructions and a challenging tradeoff between speed and accuracy in distributing PPP funds.These flaws make the PPP a realistic and valuable case study; the PPP reveals tools that can be applied to similar distributions of emergency funds. One tool is back-end adjustments, meaning that funds are first distributed and then later it is decided whether recipients may keep the money. Another tool is distribution in descending order of necessity, meaning that the first recipients to receive funds are applicants that most clearly meet the criteria of the program. A fund can follow distribution in descending order of necessity to disburse all of its funds. This approach is similar to a descending price auction for the sale of bonds or a stock of goods. Disbursing amounts in descending order of necessity also allows a fund to collect information needed to improve future distribution policy.
Author:
Publisher:
ISBN:
Category : COVID-19 (Disease)
Languages : en
Pages : 26
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