Social Capital and Access to Bank Financing: The Case of Chinese Entrepreneurs
AbstractThis 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.
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Bibliographic InfoPaper provided by School of Economics, University of East Anglia, Norwich, UK. in its series University of East Anglia Applied and Financial Economics Working Paper Series with number 019.
Date of creation: 12 Oct 2010
Date of revision:
Postal: Helen Chapman, School of Economics, University of East Anglia, Norwich Research Park, Norwich, NR4 7TJ, UK
Other versions of this item:
- Oleksandr Talavera & Lin Xiong & Xiong Xiong, 2012. "Social Capital and Access to Bank Financing: The Case of Chinese Entrepreneurs," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 48(1), pages 55-69, January.
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-23 (All new papers)
- NEP-ENT-2010-10-23 (Entrepreneurship)
- NEP-NET-2010-10-23 (Network Economics)
- NEP-SOC-2010-10-23 (Social Norms & Social Capital)
- NEP-TRA-2010-10-23 (Transition Economics)
You can help add them by filling out this form.
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