This study analyzed the way for efficient financial support to improve the competitiveness of small enterprise through the comparison of the loan default rates between the policy fund and banks loan for small enterprise in light of national balanced economy.
Important findings are as follows.
1) The default rate of the policy fund is lower than that of the banks loan for small enterprise except the year of 2008 and the difference among the default rates fetches to 0.243%. The difference in the default rates outstands in 2011. It may be due to the fact that the policy fund changes to the priority system
which subsidizes the people first who took education and consulting courses beginning 2010. The financial support associated with education and consulting is expected to perform better than that without education and consulting in terms of the loan default rate. The fact that the interest rate of the policy fund is lower
than that of banks loan could result in the lower default rate for the policy fund. Yet low interest rate turns out to be not related with low default rate in this analysis. Thus, it can be concluded that the financial support associated with education and consulting is superior to the other case.
2) The loan default rate of local banks is lower than that of nationwide banks across the policy fund and
the bank loans. The difference in the loan default rate by local banks and nationwide banks amounts
to 0.384% for the policy fund and 0.605% for banks loan. The result indicates that the loan to small
enterprise is regionally oriented since small enterprise is based on the region.
3) The loan default rate of the local ‘P Bank’ which operates the consulting center on its own for small
enterprise is significantly lower than that of nationwide banks. The difference in the default rates amounted
to 0.822%. Besides there was no notable difference across the policy fund and banks loan for ‘P Bank.’
The loan default rate of the local ‘P bank’ is lower than that of the other local banks, too. Therefore,
the lower default rate of the policy fund is attributable to consulting and education system, not to lower
interest rate set by the policy.
It is concluded that the financial support for small enterprise works better with the appropriate consulting
and education and local financial system needs to be constructed in accordance with this findings.
It has been reported that the policy fund increases the sales volume of small enterprise and the fund has
The Study of Efficient Financial Support for Small Enterprise through the Analysis of the Loan Default Rate by Small Enterprise
2
positive effect on the performance of management for small enterprise. But the policy fund can’t accomodate
all of 2.7 million of small enterprise in Korea. Banks loan take most of loan to small enterprise. Therefore,
The financial support under frequent start and closure of small enterprises these days needs to be associated
with the appropriate consulting and education for the balanced economy as a whole. The outstanding banks
loan to small enterprise now reached over 100 trillion won. If the default rate of bank loan ever rise, it gives
much more financial distress to the banks. As a result, the national economy will surely suffer.
The banks need to benchmark the expertise of the Small Enterprise Development System which has been
accumulated over the last 20 years by serving numerous small enterprises. In addition, the Small Enterprise
Development System which oversees the policy fund also needs to intensify the consulting and educational
infrastructure for the efficient financial support to small enterprise in Korea.
This paper finds that the superiority of the policy fund to the banks loan is attributable not to the lower
interest rate of the policy fund, but to the role of the counsellor at the Small Enterprise Development System
which provides the consulting and education and shows the way to the efficient financial system to strengthen
the competitiveness of small enterprise in the future.
When small enterprise borrows take loan from banks, the criteria for loan decision by banks should be based
on its pure creditability. For regional financial system in accordance with spontaneous economic principle to
work properly, the banks need to develop credit rating model associated with stylized and standard abilities
of the counsellors at the Small Enterprise Development System. It is crucial since small enterprise, especially
at the beginning stage in its business, does not have enough sound financial data for applying for banks loan.
As a matter of fact, many of start-ups are excluded even from the policy fund since the lending process
of the policy fund also puts a lot of emphasis on quantitative figure such sales volume, net income, etc. Therefore
the policy fund tends to be not properly served according to its original purpose of aiding start-ups of small
enterprises. The policy fund rather subsidizes mature small enterprises with good financial status. Considering
that there is a great need for money at the beginning stage of small enterprise, the policy fund and banks
loan need to be allocated more to start-ups rather than to growing enterprise with better statistics in terms
of sales volume and managerial environment. The appropriate credit rating model needs to be developed by
incorporating the evaluation and recommendation by the counsellors at the Small Enterprise Development System.
The banks loan does not differentiate between small enterprise and an individual or self-employed although
the government puts much energy in supporting small enterprise including making the law for small enterprise
explicitly. Therefore, banks loan system needs to be coordinated in accordance with government policy for
the competitiveness of small enterprise in light of national balanced economy, which in turn makes the aid
more effective and efficient.
This study yet has limitations in that the differences in default rates between the banks loan and the policy
fund are compared in univariate way for each category of industries, interest rates, gender, age, the business
history, etc. To analyze the determinants of the default rates of loan in more comprehensive way, multivariate
regression analysis needs to be employed by designating the default rate as a dependent variable and industries,
interest rates, gender, age, ways of supporting aids, the business history, etc. as independent variables. The
data including financial statements for small enterprise in Korea is hardly available for the quantitative analysis
such as regression analysis. Small sample of 7 banks analyzed, missing data, outliers, etc. are also restrictions
for this analysis.
It is advised that in future study more number of banks and more data after 2011 need to be analyzed to reach more meaningful conclusion for efficient way of financial support to small enterprise in terms of national economy.

This study examines the changes in the self-employment rate in Korea for the period 1975~2010.
In particular, the long-run and short-run relationships are estimated between self-employment rate and
unemployment rate. Differentiating from previous studies, this study includes various measures of self-employment
rates when estimating cointegration and error-correction models and includes asymmetric relationships between
unemployment and self-employment in the analysis. Our results indicate that there exist the long-run as well
as short-run relationships between self-employment rate and unemployment rate. Also, unemployment is found
to have a positive effect on unincorporated self-employment while it is found to have a negative effect on
incorporated self-employment. This supports a push hypothesis for unincorporated self-employment and a pull
hypothesis for incorporated self-employment. In addition, this study finds no significant changes in the selfemployment
rate after the 1998 financial crisis, but finds a positive relationship between the self-employment
rate and marginal tax rates. However, unlike the findings by Parker(1996) and others, relative income differences,
real interest rates and strikes are not found to be important factors in Korea

A small giant business called Hidden Champion produces values through continued research and
development for new markets. In industry, they also gain technical advantages which are hard to be mimicked
by other competitive in Korea so that they provide a lot of implications for domestic small and medium business.
Since the concept of small giant business was emerged in industry, it has actively been developed to be studied
in Korea, but it has been mainly focused on the limited area such as ‘finding new market’, ‘marketing strategy,’
and ‘success factors.’ For this reason, the empirical research for the development of R&D workforce, a key
for a small giant business, is insufficient.
This study was conducted to identify the key success factors of the R&D workforce development which
are essential to get technical competitiveness for small giant businesses through successful R&D training and
development of small giant businesses in Korea. This research was conducted based on the following procedures :
1) successful small giant businesses were according to the outstanding performance of technical
development among domestic small and medium businesses; 2) in-depth analysis was conducted about training
and development systems of the ed small giant businesses; and 3) key success factors of R&D workforce
development were drawn.
The research employed a CIPP model as an analysis framework and drew hypothetical success factors of
each context, inputs, process, and outputs through a review of literature. First of all, we conducted literature
review and drew effective variables of training and development of small and medium-sized businesses that
were identified as internal and external environment, task of trainees, internal characteristics of trainees and
training programs factors. In this study, we empirically verified the effective variables that were mainly focused
on the external environment of company and training programs factors except the internal characteristics of
trainees, which were less relevant to the factors of company.
The data were collected through a sample of 236 small giant business ed among domestic 4 institutes.
We ed 85 companies that had a higher R&D budget per sales rather than those with an industrial average,
because we supposed that those companies with bigger investment in R&D would put more budgets in training
and development of R&D workforce. We ed top 50 companies for a number of researchers who were
registered in the Korea Industrial Technology Association (KOITA) because we supposed that the best practices of development and training of companies would be gathered more likely if the companies had enough R&D
workforce. Among the ed 50 companies, we introduced ourselves to the company managers and asked
for an interview the employees of the companies through phone calls and e-mails, and conducted the in-depth
interviews for 11 companies which allowed us to find training and development of R&D workforce. The
interviews were conducted on 11 trainers and 4 research directors of R&D department of 11 companies.
According to this research, we drew 9 propositions in terms of training and development of R&D workforce.
The significant factors of R&D training and development performance among 9 propositions were support
of CEO, continuous learning culture, learning incentive system, usage of in-house trainers in company, informal
learning, and following up service of learning. Based on the research result, several policy implications were
suggested to support R&D training and development of small and medium companies in Korea. The suggestions
to improve the performance of R&D training and development of small and medium-sized companies are
as follows:
First, in terms of learning method, informal learning that uses internal resources of organizations such as
company academy, seminar, meeting, and knowledge sharing is effective for improving the performance of
training and development. Regarding training and development system, learning incentive system and follow-up
service of learning are effective for improving the performance of training and development. Moreover, the
support of CEO and continuous learning culture will be helpful to improve performance of training and
development in the organizational culture.
Second, the investment of training and development, the planning of training and development, and the
evaluation of training and development are not included in the hypothetical success factors. This implies that
they are not critical success factors to conduct successful training and development, but essential factors to
make training and development successful.
Third, R&D organizational features and R&D cycle will affect the strength of informal learning and they
will be considered when empirical R&D research is conducted.
Furthermore, this research provides implications of policy for establishing small and medium companies.
First of all, in order to maximize the uses of human resources in small and medium businesses, it is necessary
to support the system for developing in-house trainers. In addition, the learning incentive system that can
have a positive effect on R&D training and development should be supported at the corporate level policy.
The results of this research provide directions for future research.
First, in this research, the success factors of R&D training and development of small giant companies were
drawn by the responses of interviewees. Therefore, future research may identify a causal relationship between
R&D training and development and the performance of companies.
Second, this research findings were based on the result of the survey to 238 small giant companies so that
the result could be hard to apply for all small giant businesses. In this sense, an interesting avenue for future
research is to conduct surveys to every small giant business to have he results to be generalized.
Third, the in-depth interview was conducted for HRD directors in small giant companies in this research.
Therefore, in order to maximize the effect of the result of interview, future research may carry out more interviews
of participants who attended successful R&D training program, and further study can identify key
success factors through SCM (Success Case Method).

The small and medium enterprises(SMEs) as well as large corporations have been active on the
use internet as PR communication tool. In fact, many SMEs have and operate their own web sites for communicating
with their stakeholder. This study is to examine the Korean SMEs' web sites in terms of PR
communication, especially in the aspects of media relations. Many companies have a strong interest on
mass-media relations, because they believe that media-relations are very effective communication tools. So,
they are needed to consider actively media-relations in their on-line PR activities. That means companies'
web sites can be also a efficient and effective channels for developing and enhancing relationship with mass
media or journalists.
This study used four categories; basic media relations tools, useful information, interactive communications
tools, and ease of use for journalists. This study conducted a content analysis of 100 Korean SMEs,
Korean top 100 companies, and US SMEs' web sites. The web sites of companies were randomly assigned
to two coders who visited the sites from March 15 to April 2, 2012. This study analyzed the current status
of press room, press kit, press release data, company history, organization chart, event informations, contact
information, financial informations, site map, search service, and so on.
The results of this study show that the Korean SMEs' media relations activities throughout their web sites
are passive. Of course, the companies' web sites are not operated and managed for only media relations,
they will be able to expect a large effect, if they would use them, which are already owned, for media relations
channels. Overall, the Korean SMEs are providing a variety of information about them on their web
sites, but they don't use these channels in a PR sense. Particularly, the results of this study indicate that
the Korean SMEs need to consider their web sites for strategic media relations. This study suggests that
having and operating the web site is not important, but seeking ways to manage it efficiently is more
important. Actually it is likely to be costly to plan and manage the web sites. Therefore, SMEs in the limits
of a fairly tight budget for communications, should consider and seek a way for the efficient and cost-effective
operation of their web sites. If SMEs could offer various information for the many different types of
stakeholder, they could save a lot of expense for communication. So, this study suggests the importance that
SMEs attribute to web-based media tools to achieve organizational goals.

As the global business environment becomes competitive, major companies alone cannot keep
the long-term competitive advantage. In the ever changing business environment, it is necessary to improve
the competitiveness of major companies as well as that of SMEs that provide parts and services to major
companies to enhance the competitiveness of the entire supply chain across big and small firms. Accordingly,
studies on the collaboration among companies and its success factors have been done in various areas. However,
there is little research on the way of adopting and operating value sharing systems which are the key condition
for successful symbiotic collaboration. In the current study, we propose a theoretical framework for adopting
and running the value sharing systems in an effective manner, which leads to the effective collaboration between
large and small corporations. We in turn propose four different types of value sharing based on two dimensions
of effectiveness and efficiency which can be obtained through the collaboration between large and small
companies. We also provide examples for each type of the value sharing systems in terms of the explanation
of the types. In addition, We suggest the way of using the framework as a strategic approach to the enhancement
of business ecosystems. The proposed framework is expected to lay a cornerstone of determining the type
of value sharing and its strategic utilization and devising policy tools.