Researche Of Hold-Up Problem Between Small And Medium-Sized Enterprises And Guarantrr Institution

During the development process of reform and opening up, small and medium enterprise (SME) have achived the rapid development and become an important part of our economy. However, the current development of SME in China is also faced with many problems; one of the most prominent problems is the financing difficulties. Relative to large enterprises, SME have less plant, equipment and other fixed assets; it is difficult to provide the necessary tangible assets to banks as security for loans. Therefore, it is difficult to obtain loans from banks. In recent years, the development and growth of the security agencies has opened up new avenues to solve the problem of financing.As a third-party surety, guarantee institutions provide guarantee for SME, which guarantee its responsibilities and obligations to repay debt. If SME can not repay, guarantee institutions will be compensated, then they will recover losses from SME. Although the guarantee institutions create opportunities for SME, in process of the guarantee, Guarantee institutions are also facing great risks, for example, the risk of hold-up. So if this issue is expected, guarantee institutions may not be active in the guarantee business. Eventually, in the case of no guarantee, it is difficult for SME to obtain loans from banks. Furthermore, development of SME is affected.This paper researched the hold-up problem between SME and guarantee institutions, first, based on the previous research results, through perspective of the hold-up, analyzed the relationship between SME and guarantee institutions in guarantee business. By establishing mathematical model, this paper analyzed the changes of earnings in the case of hold-up.Then the paper established the game model and analyzed decisions between SME and guarantee institutions. Finally, the paper proposed the governance program for the hold-up problem,which could mitigate the risk of guarantee institutions’being holded-up and promote the development of guarantee business, eventually ease financing problem of SME, and promote the development of SME in a sustained way.The paper is divided into introduction and text. Introduction introduced the researches of the guarantees and hold-up theory in domestic and foreign, and did a brief review, text is divided into four chapters, firstly, briefly described the hold-up problem in the guarantee business; secondly, from a theoretical point of view, analyzed the characteristics, formation mechanism and influence of the hold-up; thirdly, by the establishment of mathematical models, deeply analyzed the hold-up problems from the perspective of game theory; finally, proposed governance programs and derived the conclusion...