Social networks and informal financial inclusion in China

Chai, Shijun; Chen, Yang; Huang, Bihong; Ye, Dezhu

doi:10.1007/s10490-017-9557-5

Cited by 38 publications

(18 citation statements)

References 76 publications

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“…In essence, the rationale underlying the influence of social networks on herder borrowing behavior is the same as that observed in the case of herder household income, except that the former usually works as a mediator for the latter. A herder who holds a superior position in the social network can utilize their positional advantages to acquire more information and resources with regard to formal credit, and hence, they have a higher probability of securing a loan [41,42]. Subsequently, the money borrowed is usually used to replenish production capital, and it may contribute to a higher level of production efficiency and to higher profits.…”

Section: Discussionmentioning

confidence: 99%

Effects of Social Network on Herder Livestock Production Income and the Mediation by Fund Loans

et al. 2020

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Due to its alpine geography and harsh environment, the pastoral region of Qinghai Province is widely recognized as one of China’s concentrated and contiguous poverty-stricken regions, while climate change, market competition and grazing control exert further pressure on the income security of herders. After more than 1000 years of nomadic practice, cooperation and reciprocity have been entrenched in the culture of pastoral ethnic minorities, in which a well-developed social network may play a crucial role in herders’ social and economic activities, including their financial and production behaviors. Based on a questionnaire survey of 278 households in two counties of Qinghai, this study empirically examined the effects of herders’ social network on their livestock production income and the mediation function of fund loans therein. The social network was found to exert a significant positive impact on household income, and loans had a positive mediation effect. By comparison, the mediation effect of formal borrowing channels was statistically significant while that of informal channels was not, which may be attributed to the relative degree of maturity of the two disparate financial markets. It is suggested that a closer and more inclusive social network should be fostered, the quality of bank financial services should be improved, and the regulation on informal credit activities should be reinforced, so as to fully exploit the positive roles of the social network and fund loans for income growth of herder households in vast pastoral areas of China.

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Section: Discussionmentioning

confidence: 99%

Effects of Social Network on Herder Livestock Production Income and the Mediation by Fund Loans

et al. 2020

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“…With the widespread use of digital technology in agriculture, digital financial inclusion has become an important tool for improving ASC performance, especially in developing countries. Evidence from developing countries, such as China and India, shows that digital financial inclusion can promote rural e-commerce [47][48][49], address financial instability [50,51] and increase the income of small peasants [52][53][54].…”

Section: Digital Finance Inclusion In Ascmentioning

confidence: 99%

The Protective Effect of Digital Financial Inclusion on Agricultural Supply Chain during the COVID-19 Pandemic: Evidence from China

Zhang

2021

JTAER

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Financial inclusion plays a positive role in protecting agriculture during or after disaster. This paper focuses on the protective effect of digital financial inclusion on the agricultural supply chain and analyzes three mechanisms of the protective effect: financial widening, financial deepening, and financial services digitization. Based on the Gravity Equation, we conduct an empirical study using agricultural logistics and digital financial inclusion data from China. The regression results indicate that a 1% increase in the digital financial inclusion, measured by the Peking University Digital Inclusion Index, increases agricultural trade during the COVID-19 pandemic by approximately 1.6%. Furthermore, heterogeneous protective effects exist between regions in China. Digital financial inclusion is more effective in the Eastern regions in protecting the ASC than in other regions. This paper enriches the understanding of financial inclusion in helping agriculture supply chain recovery.

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“…All five articles concerning the Chinese guanxi bear the similar implications that informal ties and networks are expected to continue and persist in China at least for now. It is worth noting that the two empirical articles in the specific sector of financial service (Chai, Chen, Huang & Ye, 2019;Luo, Rong, Yang, Guo & Zou, 2019) seem to imply that the existence of informal ties and networks can be explained primarily as a rational response to the lack of certainty due to the absence of established formal institutions, such as mature financial markets for borrowing and lending as well as venture capital investment in China, we would rather offer a distinctive explanation that the need for informal ties and networks could be twofold with the competing logics of both informal (e.g., cultural preference) and formal (e.g., the rule of law and state policies) institutions, largely because both types of institutions provide the necessary legitimacy above and beyond the iron cage of formal institution as the biased, incomplete view (Dimaggio & Powell, 1983;Scott, 2003). It seems that informal and formal institutions can be much more complementary than what had been recognized in the prevailing literature in the West (Chai et al, 2019;Horak & Restel, 2016;Li, 2007b;Lin et al, 2016).…”

Section: The Critical Implications Of the Special Issuementioning

confidence: 99%

The unique research on the informal ties and social networks in East Asia: Diverse perspectives and new research agenda

Xie

2019

Asia Pac J Manag

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It is our pleasure to introduce the Special Issue of the Asia Pacific Journal Management with the focus on the theme of Informal Social Networks in East Asia. This introduction is organized into three parts, with the first part covering the background and review process of the Special Issue; the second part covering the specific contents of the nine articles included in the Special Issue, and the third part covering the critical implications of the Special Issue.

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Social networks and informal financial inclusion in China

Cited by 38 publications

References 76 publications

Effects of Social Network on Herder Livestock Production Income and the Mediation by Fund Loans

Effects of Social Network on Herder Livestock Production Income and the Mediation by Fund Loans

The Protective Effect of Digital Financial Inclusion on Agricultural Supply Chain during the COVID-19 Pandemic: Evidence from China

The unique research on the informal ties and social networks in East Asia: Diverse perspectives and new research agenda

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