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Social capital and the financing performance of farmer cooperatives in Fujian Province, China

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  • Liyan Yu
  • Jerker Nilsson

Abstract

Although social capital is commonly believed to affect cooperative financing, empirical results are sparse. Using data from surveys of members of 60 cooperatives in Fujian province, China, this study shows that social capital is related to cooperative financing performance, interpreted as (1) members’ willingness to provide equity, (2) loans from members and from banks, and (3) cooperatives providing financing services to members. Three dimensions of social capital are identified; external, relational, and cognitive. The findings indicate that Chinese cooperatives obtain bank credit more easily if they have been granted government “honors” and if the chairperson has government contacts (external social capital). Loyal members (relational social capital) are more likely to obtain financial services, such as guarantees for member loans. Cooperatively convinced members (cognitive social capital) are more willing to provide capital. [EconLit citations: A13; P13; Q14].

Suggested Citation

  • Liyan Yu & Jerker Nilsson, 2018. "Social capital and the financing performance of farmer cooperatives in Fujian Province, China," Agribusiness, John Wiley & Sons, Ltd., vol. 34(4), pages 847-864, October.
    • Handle: RePEc:wly:agribz:v:34:y:2018:i:4:p:847-864
    DOI: 10.1002/agr.21560
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    Cited by:

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    2. Axel WOLZ & Shemei ZHANG & Ya DING, 2020. "Agricultural production cooperatives and agricultural development: Is there a niche after all? Findings from an exploratory survey in China," CIRIEC Working Papers 2004, CIRIEC - Université de Liège.
    3. Xiyuan Yu & Wenli Liu & Lingli Qing & Di Zhang, 2023. "Improving Farm Cooperatives’ Performance and Sustainability: A Study of Agricultural Managers’ Competencies Based on the Grounded Theory and the fsQCA Methods," Sustainability, MDPI, vol. 15(2), pages 1-16, January.
    4. Liyan Yu & Jerker Nilsson, 2019. "Social Capital and Financial Capital in Chinese Cooperatives," Sustainability, MDPI, vol. 11(8), pages 1-15, April.
    5. Chrysoula Morfi & Jerker Nilsson & Karin Hakelius & Kostas Karantininis, 2021. "Social networks and member participation in cooperative governance," Agribusiness, John Wiley & Sons, Ltd., vol. 37(2), pages 264-285, April.
    6. Bin Guo & Lei Yuan & Mengyuan Lu, 2023. "Analysis of Influencing Factors of Farmers’ Homestead Revitalization Intention from the Perspective of Social Capital," Land, MDPI, vol. 12(4), pages 1-18, April.
    7. Yangyang Zheng & Jianhong Lou & Linfeng Mei & Yushuang Lin, 2023. "Research on Digital Credit Behavior of Farmers’ Cooperatives—A Grounded Theory Analysis Based on the “6C” Family Model," Agriculture, MDPI, vol. 13(8), pages 1-19, August.

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