The Korea Local Administration Review

The spread of COVID-19 has led to an increased focus on support policies for
small business owners. However, empirical research on policy implementation at
the local level remains scarce. This study empirically analyzed the factors affecting
the introduction of COVID-19 disaster support policies for small businesses and
the scale of the budget using their own resources of local governments during
the period of 2020 to 2021.
The analysis results showed that economic factors such as the administrative
capacity and financial conditions, and institutional factors such as the ordinance
adoption, did not have a significant impact. However, political factors such as
the vote share of local leaders and the divided governments played a significant
role and external diffusion factors due to imitation of other local governments,
showed a significant impact. These analysis results show that the external diffusion
model, internal decision factors, and competitive behavior among politicians
influenced the introduction of COVID-19 disaster support policies for small business
owners. It also shows that a systematic institutional foundation related to local
government finance and organization is needed to support policies for small business
owners in pandemic situations.