Research On The Moral Hazard Control Of Mutual Loan Guarantee For Small And Micro Enterprises

Nowadays small and micro enterprises play a very important role in many fields of national economy.The problem of financing difficulty also has been an important constraint for its development.Although China's small micro-enterprise financing environment has been improved in recent years,more and more financing institutions took small micro-enterprise financing services as an important develop direction,but the service body for small business financing is still to face three problems:information collect difficulty,risk control and cost control.Because of cluster-based organization,mutual loan guarantee has information superiority,which can alleviate the financing problems of small and micro enterprises.At present,mutual loan guarantee has become an important way to solve the financing problems of small and micro enterprises in theoretical research and practice.However,mutual loan guarantee cannot be completely free from risk with the information superiority.For moral hazard,the existing research is aimed at two questions:"if mutual loan guarantee produces moral hazard"?and "why mutual loan guarantee will produce moral hazard"?After years of research accumulation,these two questions have been discussed a lot,and have achieved a lot of constructive and important results,but after careful compilation of the literatures,we found that these literatures still did not cross the barriers of these two questions.For the moral hazard management framework of mutual loan guarantee,only these two questions are still incomplete,there is no substantive solution to the moral hazard of mutual loan guarantee,and it needs to be further developed.Based on the considerations,to complete the mutual loan guarantee moral hazard management research framework,this paper,adopted the research approach of"background investigation-theory and literature combing-model derivation-numerical simulation-policy suggestion",introduced transaction cost theory,social capital theory,principal-agent theory,dynamic incentive theory and incentive compatibility and participation constraint theory,applied literature analysis and model simulation method,discussed two questions:" what specific moral hazard behaviors will expressed in mutual loan guarantee?" and " How to control the specific moral hazard behaviors of mutual loan guarantee?" the research conclusion is:(1)Member companies will have overleveraged moral hazard behavior,solvency regulation and benefit compensation policy can control it.Under the mutual and the limited natures of the mutual guarantee fund,member enterprises reduce the solvency can obtain more guarantee value,so that the over leverage can make the member enterprises get more benefits in the mutual guarantee and caused moral hazard.In order to control this risk,the mutual guarantee institution may set an observation value of the solvency of a member enterprise.If the member company's solvency is worse than this observation value during the guarantee period and the duration is constant,the guarantee will be terminated;And if the member company's solvency is better than the observation value in the guarantee period,or the time did not meet the time limit,then obtain a benefit.Through the analysis of the above control actions,we found that all member companies can't get more benefits with overleveraged,this moral hazard behavior has controlled.(2)Member companies will have the effort level choose moral hazard behavior,the sequential guarantee mechanism can control it.In order to avoid joint liability and get more benefits,member companies choose to reduce the effort level.In order to control the risk,mutual institutions may introduce the concept of sequential guarantee mechanism on the basis of supervision and punishment measures mechanisms,that is many members been divided into several groups,one of the members of one group is guaranteed at one time,and then for the next member of the group,and if the order of the forefront of member default,the order behind all the enterprises can't be guaranteed.Through the analysis of the above control actions,we found that both margin and joint responsibility increased if the member companies reduce the level of effort,and the company to be subject to internal punishment,so this moral hazard behavior has controlled.(3)Member companies will have the asset replacement moral hazard behavior,the guarantee institutions and member companies agreed on equilibrium risk level can control it.In order to maximize the project benefit,member company will invest the project which has optimal risk level.The greater of the difference between the optimal risk level and the project level agreed by the guarantee contract,the more the member companies will produce the asset replacement moral hazard behavior.In order to control this risk,the guarantee institution can adjust its own risk level to alleviate the overall risk increase which caused by the implementation of the asset replacement behavior by the member companies,or agree on a equilibrium risk level which satisfies the sum of the two sides.We found that the equilibrium risk level is obviously lower than the unilateral risk level choice of the member enterprise,and the corresponding income is higher too when the equilibrium risk level is higher.Therefore,the equilibrium condition will weaken the asset replacement behavior in a certain extent.This paper's purpose is to complete moral hazard risk management research framework of mutual loan guarantee in theory.Based on the existing research,this paper clarifies the three kinds of moral hazard behaviors which may appear in the mutual guarantee,and puts forward the corresponding moral hazard behaviors control actions,which is a great theoretical significance for the further and improvement of the existing moral hazard control framework research.At the end of the paper,concludes with the conclusion of the research and the guarantee practice of our country,we introduced some policy suggestions which is aimed at optimizing the design of mutual guarantee contract,innovating the risk control mechanism and improving the efficiency of mutual guarantee fund,to protect the effectiveness of mutual guarantee institutions.