The authors assess empirically the impact on firm performance of a state-subsidised training-loan scheme for small businesses (the Small Firms Training Loan Scheme). To achieve this assessment, a longitudinal sample of firms that received loans from the leading lender under the scheme, Barclays Bank, and a control sample of otherwise similar nonparticipants with Barclays accounts were studied. The authors present and apply a panel-data methodology for estimating the impact of the scheme on firm growth, which is able to take into account nonrandom selection onto the scheme. The main empirical findings are that participants are both more likely to survive and to grow faster than nonparticipants.
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