Social Capital, Financial Lending, and Household Income—An Empirical Study from China

Xiangdie Chen () and Qiqing Zhou ()
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Xiangdie Chen: Yanbian University
Qiqing Zhou: College of International Economics, Shaanxi Institute of International Trade & Commerce

Journal of the Knowledge Economy, 2024, vol. 15, issue 4, No 25, 16096-16121

Abstract: Abstract This study focuses on China as the research subject, obtaining relevant research data from the China Family Panel Studies Database (CFPS). Panel data is formed, and a double fixed-effects model is employed to explore the relationship between social capital, financial lending, and their interaction term with household income. The results of the study indicate that social capital can promote an increase in household income, with only relational social capital having a significant effect on it. Financial lending also has a positive impact on household income, but only formal financial lending plays a constructive role. Additionally, a significant interaction effect between social capital and financial lending is observed, with the interaction term contributing to higher household income. Further tests through heterogeneity analysis reveal variations in the interaction effects across populations. Specifically, the central region of China, individuals aged 60 or older, and those with middle and high school education show significant interaction effects.

Keywords: Social capital; Financial lending; Household income; Double fixed effects model; Coordination effects (search for similar items in EconPapers)
JEL-codes: A14 R11 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s13132-023-01723-w

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