Social Capital and Access to Bank Financing: The Case of Chinese Entrepreneurs

Oleksandr Talavera (), Lin Xiong and Xiong Xiong
Additional contact information
Lin Xiong: Robert Gordon University
Xiong Xiong: University of Tianjin

No 19, University of East Anglia Applied and Financial Economics Working Paper Series from School of Economics, University of East Anglia, Norwich, UK.

Abstract: This paper studies the effects of social capital on access to bank financing. Based on a Chinese nationwide survey our analysis suggests that entrepreneurs who spend more time on social activities are more likely to obtain a loan from commercial banks. In addition, we find that membership of political parties is an important determinant of state bank financing. Finally, our data reveal some evidence of substitutability between various types of social capital. To get a loan from a specific type of bank, an entrepreneur should access the relevant social network. The results of our analysis are robust to a number of specification checks.

Keywords: China; social capital; entrepreneurs (search for similar items in EconPapers)
JEL-codes: G21 L26 (search for similar items in EconPapers)
Date: 2010-10-12
New Economics Papers: this item is included in nep-ent, nep-net, nep-soc and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Social Capital and Access to Bank Financing: The Case of Chinese Entrepreneurs (2012)
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