Over the past few decades, Taiwan has adopted various financial support measures as a means of promoting industrial development during the different stages of the island’s economic development. These measures were largely designed to meet specific purposes. Those measures most commonly pursued have been special low-interest rate loans, insurance, guarantees, subsidies, and even direct investment. However, the effects of such government-provided support measures differ according to the various theories arising from a survey of the literature. Empirical evaluation shows that although these measures can function as a marginally influential factor, they do not usually play a decisive role in economic activities. Looking to the future, particularly in the wake of WTO accession, Taiwan should demonstrate greater caution when seeking suitable measures for providing financial support to its industries.
