Public Firm Borrowers of the US Paycheck Protection Program

We document that nearly half of public firms were eligible for the Paycheck Protection Program (PPP), with 30.3% of those eligible choosing to borrow. Consistent with the program's objectives, borrowers tended to be smaller, have less cash, have higher leverage, and fewer investment opportunities. In addition, they faced negative profits in the second quarter of 2020 and their firm values declined upon PPP loan announcement. We further document that 17.7% of PPP borrowers, in particular the healthier firms, returned their loan after public backlash. Overall, concerns of reputational harm from public disclosure appeared to prevent eligible firms from availing emergency government funding.