We provide an initial assessment of the US Paycheck Protection Program by studying the 273 public firms that received a total of $929 million in loans between April 7-27, 2020. Despite receiving significant media coverage, these firms comprise 0.3% of the funds disbursed. Using guidelines specified by the US Small Business Administration, we document that about half of public firms were eligible to apply, of which 13% were eventual borrowers. Within the set of eligible firms, public firm borrowers tended to be smaller, have more employees, have fewer investment opportunities, have pre-existing debt balances, and be located in a county with Covid-19 cases. Implementing additional eligibility requirements may help target funds towards the most constrained firms.
Lead investigator: | Anna Cororaton |
Affiliation: | Cox School of Business, Southern Methodist University |
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Start date | 4/2020 |
End date | 4/2020 |
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