IDEAS home Printed from https://ideas.repec.org/a/gam/jecomi/v12y2024i7p188-d1438146.html
   My bibliography  Save this article

Modeling of Complex State Financial Support for Small and Medium-Sized Enterprises

Author

Listed:
  • Kristina Alekseyevna Zakharova

    (Department of Economics and Finance, Finance and Economics Institute, University of Tyumen, 625003 Tyumen, Russia)

  • Danil Anatolyevich Muravyev

    (Department of Economics and Finance, Finance and Economics Institute, University of Tyumen, 625003 Tyumen, Russia)

  • Egine Araratovna Karagulian

    (Department of Economics and Finance, Finance and Economics Institute, University of Tyumen, 625003 Tyumen, Russia)

Abstract

This article describes a new approach to determining the optimal amount of state financial support provided to business entities. It is shown that there are three available methods to support economic agents. The most cost-effective option is subsidizing business entities to expand their current assets. It has been revealed that there are not just optimal amounts of government financial support but also optimal not-to-exceed amounts that make it possible to identify the boundaries of the so-called highly productive state of the economy. In this case, when the economy is highly productive, the prices of goods (services) fall, workers spend their savings, and the volume of production increases. This ultimately leads to an increase in the well-being of the population. The differential equations are the basis for the model, which is similar to the model of a simple two-sector single-product economy. The Monte Carlo method is used to determine the optimal not-to-exceed amount for government financial support. The identification of such intervals allows us to determine the amount of state financial support that will lead to a highly productive state and will not contribute to an unreasonable expansion of the budget expenditure. This study’s results can be utilized by government authorities for the development of a comprehensive system of state financial support for entrepreneurship. Business entities can use the results of this research concerning the calculation of the optimal not-to-exceed amount of financial support.

Suggested Citation

  • Kristina Alekseyevna Zakharova & Danil Anatolyevich Muravyev & Egine Araratovna Karagulian, 2024. "Modeling of Complex State Financial Support for Small and Medium-Sized Enterprises," Economies, MDPI, vol. 12(7), pages 1-18, July.
    • Handle: RePEc:gam:jecomi:v:12:y:2024:i:7:p:188-:d:1438146
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-7099/12/7/188/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-7099/12/7/188/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Branstetter, Lee G. & Li, Guangwei & Ren, Mengjia, 2023. "Picking winners? Government subsidies and firm productivity in China," Journal of Comparative Economics, Elsevier, vol. 51(4), pages 1186-1199.
    2. Sha, Zhouhao & Ren, Dong & Li, Chengyou & Wang, Zeru, 2024. "Agricultural subsidies on common prosperity: Evidence from the Chinese social survey," International Review of Economics & Finance, Elsevier, vol. 91(C), pages 1-18.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ivana Kravčáková Vozárová & Rastislav Kotulič, 2024. "The Impact of EU Subsidies on the Competitiveness of Slovak Farms from the Perspective of Legal Form," Agriculture, MDPI, vol. 14(8), pages 1-15, August.
    2. Dahlström, Petter & Lööf, Hans & Sjöholm, Fredrik & Stephan, Andreas, 2023. "The EU’s competitive advantage in the "clean-energy arms race"," Working Paper Series in Economics and Institutions of Innovation 495, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
    3. Zhao, Lin & Chong, Kim Mee & Gooi, Leong-Mow & Yan, Luqing, 2024. "Research on the impact of government fiscal subsidies and tax incentive mechanism on the output of green patents in enterprises," Finance Research Letters, Elsevier, vol. 61(C).
    4. Mergele, Lukas & Hennicke, Moritz & Lubczyk, Moritz, 2025. "The big sell: Privatizing East Germany’s economy," Journal of Public Economics, Elsevier, vol. 242(C).
    5. Pengjing Zhang & Tao Xiong, 2025. "Can Agricultural Subsidies Reduce Cropland Abandonment in Rural China?," Agriculture, MDPI, vol. 15(8), pages 1-21, April.
    6. Ying Zhang & Shouming Chen & Yujia Li & Disney Leite Ramos, 2024. "Does Environmental Protection Law Bring about Greenwashing? Evidence from Heavy-Polluting Firms in China," Sustainability, MDPI, vol. 16(5), pages 1-20, February.
    7. Li, Guangwei & Branstetter, Lee G., 2024. "Does “Made in China 2025” work for China? Evidence from Chinese listed firms," Research Policy, Elsevier, vol. 53(6).
    8. Huang, Xiulu & Wang, Xiaoyu & Ge, Pengfei, 2024. "Selective industrial policy and innovation resource misallocation," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 124-146.
    9. Guangwei Zhang & Yahan Shi & Nuozhou Huang, 2024. "Government Subsidies, Green Innovation, and Firm Total Factor Productivity of Listed Artificial Intelligence Firms in China," Sustainability, MDPI, vol. 16(8), pages 1-20, April.
    10. Yu Cao & Francesca de Nicola & Aaditya Mattoo & Jonathan David Timmis, 2024. "Technological Decoupling ? The Impact on Innovation of US Restrictions on Chinese Firms," Policy Research Working Paper Series 10950, The World Bank.
    11. Lyu, Jiayu & Li, Lu & Liu, Yuqi & Deng, Qian, 2025. "Promoting common prosperity: How do digital capability and financial literacy matter?," International Review of Financial Analysis, Elsevier, vol. 97(C).
    12. Telegdy, Álmos & Tóth, Gábor, 2024. "A támogatott hitelezés hatásvizsgálata Magyarországon [Impact assessment of subsidised loans in Hungary]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(2), pages 113-130.
    13. Chao Wang & Jiapeng Li & Yang Yi & Shuwang Yang, 2024. "Crowding in or crowding out? Executive environmental attention and ESG performance of mining listed companies," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 37(4), pages 897-913, December.
    14. François Chimits, 2023. "What Do We Know About Chinese Industrial Subsidies?," CEPII Policy Brief 2023-42, CEPII research center.
    15. Hanming Fang & Ming Li & Guangli Lu, 2025. "Decoding China’s Industrial Policies," PIER Working Paper Archive 25-012, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    16. Meijun Zhu & Kengcheng Zheng & Baoliu Liu & Fang Jin, 2024. "Can Agricultural Support and Protection Subsidy Policies Promote High-Quality Development of Grain Industry? A Case Study of China," Agriculture, MDPI, vol. 14(10), pages 1-22, September.
    17. Ivana Kravčáková Vozárová & Rastislav Kotulič, 2025. "Exploring the Role of EU Subsidies in Enhancing the Competitiveness of Slovak Farms," Agriculture, MDPI, vol. 15(7), pages 1-15, March.
    18. Xu, Mingjun & Chen, Changling & Ahmed, Memon Aftab, 2024. "Market-oriented farmland transfer and outsourced machinery services: Evidence from China," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 1214-1226.
    19. Ting Feng & Zhongyi Xue, 2023. "The impact of government subsidies on corporate resilience: evidence from the COVID-19 shock," Economic Change and Restructuring, Springer, vol. 56(6), pages 4199-4221, December.
    20. Guo, Dong & Li, Lin & Pang, Guoguang, 2024. "How does digital inclusive finance affect county's common prosperity: Theoretical and empirical evidence from China," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 340-358.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jecomi:v:12:y:2024:i:7:p:188-:d:1438146. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.