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Can social networks increase households’ contribution to public-good provision in rural China?: The case of small hydraulic facilities construction

Qihua Cai, Yuchun Zhu and Qihui Chen ()

China Agricultural Economic Review, 2016, vol. 8, issue 1, 148-169

Abstract: Purpose - – The purpose of this paper is to examine the roles social networks play in households’ contribution to the provision of small hydraulic facilities (SHFs) in rural China. Design/methodology/approach - – This paper adopts a sample-selection ordered probit model (Greene and Hensher, 2010) to estimate the impacts of overall social-network intensity, of the number of strong ties (relatives), and of the number of weak ties (friends), using data on 1,064 representative households collected from three provinces (Inner Mongolia, Ningxia, and Shandong). Findings - – The numbers of strong ties and weak ties both have significant impacts on households’ willingness to contribute to SHFs provision, but only the latter has a significant impact on their level of contribution. More specifically, a one standard deviation increase in the number of weak ties (i.e. friends) is associated with a 6.6 percent increase in households’ propensity of contributing more than 550 yuan and a 8.2 percent decrease in their propensity of contributing less than 100 yuan. Originality/value - – This paper is the first to examine the impacts of social networks on households’ contribution to SHFs provision in rural China. Its finding is of great policy relevance-fostering and maintaining social networks (e.g. through rural cooperatives) can significantly increase households’ contribution to public-good provision.

Keywords: Social network; Rural China; Public-good provision; Small hydraulic facilities; Sample-selection ordered probit model (search for similar items in EconPapers)
Date: 2016
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