Guaxi and financial exclusion: Empirical evidence from households in China

Kehan Zhu, Yuhong Zhou and Jingmei Zhao

Pacific-Basin Finance Journal, 2021, vol. 67, issue C

Abstract: The world has attached great importance to the development of inclusive finance. As the most populous country, the promotion of inclusive finance in China is crucial to the realization of global financial inclusion. Guanxi, translated as social relations, is the core structure of Chinese society. Whether and how Guanxi affects financial exclusion has attracted special attention. Using data from the China Household Finance Survey (CHFS) in 2017, this study found Guanxi has a significantly negative impact on household financial exclusion, and the impact on liability financial exclusion is greater than that on asset financial exclusion. This study also shows that Guanxi will promote household participation in financial markets by increasing information transmission and knowledge dissemination and reducing the probability of asset financial exclusion. Guanxi could alleviate liability financial exclusion by facilitating information transmission, providing soft information and guarantees.

Keywords: Financial inclusion; Financial exclusion; Social relations (search for similar items in EconPapers)
JEL-codes: D14 G5 Z13 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:67:y:2021:i:c:s0927538x21000731

DOI: 10.1016/j.pacfin.2021.101566

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