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Does public data openness help reduce bank risk? — A quasi-natural experiment from China

Author

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  • Ren, Meixu
  • Zhao, Jinxuan
  • She, Kaiwen

Abstract

This paper aims to investigate whether the opening of public data platforms can reduce bank risk and enhance banks' support for the real economy. Leveraging the staggered rollout of municipal-level public data platforms across China as a quasi-natural experiment, we find that public data openness significantly reduces bank risk and improves its operational soundness. Mechanism analyses suggest that public data openness enhances credit allocation efficiency, facilitates banks’ digital transformation and fee-based business activities, and strengthens external monitoring by market participants, all of which contribute to reducing bank risk. Further analysis reveals that the risk-reducing effects are most pronounced among smaller banks and those with lower information transparency. Additionally, we find that public data openness encourages proactive risk-taking by banks and enhances liquidity support to the real economy. Overall, our research suggests that promoting public data openness is beneficial for reducing bank risks and enhancing banks' support for the real economy.

Suggested Citation

  • Ren, Meixu & Zhao, Jinxuan & She, Kaiwen, 2026. "Does public data openness help reduce bank risk? — A quasi-natural experiment from China," Economic Modelling, Elsevier, vol. 158(C).
    • Handle: RePEc:eee:ecmode:v:158:y:2026:i:c:s0264999326000726
    DOI: 10.1016/j.econmod.2026.107543
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    Keywords

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    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration

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