A Research Of Mutual Guarantee Motion Mechanism For Small Business Based On Social Capital Perspective

Financing problems of small business enterprises has restricted the development of small enterprises for a long time. There are three main reasons for these problems, lack of collateral assets, flow of the credit, information asymmetry between banks and enterprises. Based on the study, mutual guarantee institution may alleviate the financing problem of small businesses. China’s economic scholars have made valuable suggestions at many sides, such as the impact factors of mutual guarantee, the design of mutual guarantee system, and the risk-sharing with others etc. But by combing the literature research, I found that there is few scholars’research which is from the perspective of social capital.Social capital is another important capital for small businesses, even more important than physical capital and human capital. The concept of social capital involves the economic, the politics, the management science and so on many areas. In economics, the object of our study is the corporate social capital, which include three contents. Firstly, it is based on social network; secondly, it is a relational resource among enterprises; the third, it refers to the ability of the enterprises, for gaining access to the actual or potential resources. Therefore in this study, we defines it as that: enterprises in their particular network of relationships can have access to resources, no matter tangible or intangible, which is embedded in the network of relationships, and the ability to get the resources. Due to the definition, trust, cooperation, and credit constraints are the core elements of corporate social capital. In this paper, I will describe the formation process of trust, cooperation, credit constraints, as well as their mechanism. I will explain how they provide the motion for the small businesses mutual guarantee institution.There are three bases in the formation of trust, the social basis, the organizational foundation and the interests. In this paper, I target to the small businesses and the mutual guarantee institution, and use the two-dimensional matrix game of trust, for analyzing the decision of which the small businesses take. I find that as a rational agent keeps his promise will be his best choice. At the same time, I analyze the formation mechanism of trust in the small business mutual guarantee in detail. Cooperation including information exchange, resource sharing, risks sharing, mutual interests, cultural integration and so on. In this paper, I analyze the mechanism of cooperation in small business mutual guarantee on the basis of the contents. At the same time, I also analyze the game paradox in the process of cooperation. According to the result, I find that the cooperation cannot run well without the credit constraints. On the other hand, I draw a diagram of cooperation mechanism in small business mutual guarantee, to explain how the cooperation mechanism runs. The credit constraint mechanism is the protection and support for the trust mechanism and the cooperation mechanism. I study the characteristics of the credit constraints, and generalize the three main aspects. It is include the system specification constraints, the constraint from the third role, and the cultural and moral constraints. More importantly, I use the dynamic game model to explain that the credit constraints are how to work in the process of mutual guarantee financing.In draws the analyses in the foundation, I conclude that if we want to work out the financing problems of small businesses, we should improve the financial environment, and develop the small businesses mutual guarantee institution. Specifically, we should increase the social capital of small businesses, improve the level of small business credit, perfect the mutual guarantee system, and enhance the credit rating system for small businesses.