On Influence of Credit Guarantee on SMEs Participation into Government Procurement:A Perspective from Information Economics

The information asymmetry between the government and SMEs hinders the government procurement plans to play their supportive role in the development of SMEs.Based on the theory of information economics,the paper analyzed the reaction of SMEs when they participate in the government procurement plans under different information structures,and found that the involvement of guarantee agencies changes the information structure between the purchaser and the supplier.The risk is transferred to the guarantee agency,and the income of the supplier and the effectiveness of the purchaser thus have been improved.The introduction of the government procurement credit guarantee has a positive impact on SMEs participation into government procurement program.