Research Of Hold-Up Risks In The Local SME Industrial Park

After the reform and opening up, China’s transition from planned economy to market economy system, and the economy appeared an unprecedented vitality. During the30years of development, SMEs have become the main force in local economic. Therefore, in order to promote local economic and enhance China’s international competitiveness, develop the SMEs is the only way out for China’s economic take-off. However, SMEs, due to a variety of defects which are derived from its own smaller scale, make it in a disadvantaged position at the competitive compared with the large-scale enterprises, and the development is less than ideal. This dilemma of SMEs makes the "how to make rapid and healthy development of China’s SMEs" has become a major problem for local governments. From the process of economic development of countries, industry cluster is just an effective solution to the plight of SMEs. Therefore, to construct the SME Industrial Park is the hope to promote SMEs and local economic together.From the current situation of China’s local SME Industrial Park, although local governments actively create the industrial park, but there have been numerous problems in the development process of the Park’s. For example:Blindly follow and structural convergence in the construction of the park makes the vicious competition between the regional economic situation. The relevance between enterprises is not high, and makes the phenomenon of that "poly" instead of "group" appeared in the park. Inappropriate government intervention hinders Park’s development. Vicious competition among the enterprises and innovation inert led to the overall decline in the quality of the products of the Park. In the construction of industrial parks, SMEs are the backbone, the government is a key factor, and these problems are more or less due to the uncertain relationship between government and SMEs. In order to make the park develop fast and well, its only to handle the relationship between government and SMEs.Based on the problems of the development in local SME Industrial Park, the paper used the conditions of hold-up problem to explain the reason of hold-up relations between government and SMEs, and analyzed the risk of being hold-up between local government and single SMEs face in various stages of the park’s development. Then, by establishing the hold-up model, the paper analyzed changes in the government and single SME’s expected revenue for hold-up risk in local SME Industrial Park. And through the game equilibrium analysis, the paper discussed the decisions of the government and single SMEs. Finally, based on the circumstances of single SME hold-up by local government, the paper proposed the governance programs to reduce the hold-up risk in SME Industrial Park, and promote the healthy development of the Park.