Social Capital, Finance, and Consumption : Evidence from a Representative Sample of Chinese Households
Using a new, nationally representative sample of Chinese households, this paper studies how social capital affects access to credit and its implications for consumption levels. The paper focuses on two specific forms of social capital: private soci...
| Main Authors: | , , , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2016/10/26885217/social-capital-finance-consumption-evidence-representative-sample-chinese-households http://hdl.handle.net/10986/25317 |
| Summary: | Using a new, nationally representative
sample of Chinese households, this paper studies how social
capital affects access to credit and its implications for
consumption levels. The paper focuses on two specific forms
of social capital: private social networks and membership in
the Communist Party. Although party affiliation is linked to
higher consumption in rural areas, those benefits are direct
and thus do not work through credit markets. The main
finding is a strong link between private social networks,
use of informal credit, and household consumption.
Instrumental variable regressions indicate that the link is
causal. However, the study finds no evidence that social
capital has facilitated formal credit market development in
China, as it has in countries with higher levels of private
sector development. |
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