IDEAS home Printed from https://ideas.repec.org/a/eee/reveco/v88y2023icp60-72.html
   My bibliography  Save this article

Religion and household borrowing: Evidence from China

Author

Listed:
  • Feng, Dawei
  • Gao, Mengtao
  • Zhou, Li

Abstract

This study investigates the effect of religious beliefs on household borrowing behaviors from theoretical and empirical perspectives using microdata from the China Family Panel Studies (CFPS). The empirical results reveal that religious beliefs significantly increase households’ willingness to borrow. After propensity score matching, panel-fixed effect, instrumental variables regression, and robustness checks, the positive relationship remained. The mechanism analysis revealed that religious beliefs promote household borrowing by enhancing social networks. The effect of religious beliefs on household borrowing is more significant in rural areas with low income and low cognitive ability, but mainly promotes informal household borrowing, indirectly providing evidence of the underlying mechanism. Thus, this study plays an important role in guiding residents to hold reasonable religious beliefs and highlights the role of informal institutions in promoting the smooth development of the lending market.

Suggested Citation

  • Feng, Dawei & Gao, Mengtao & Zhou, Li, 2023. "Religion and household borrowing: Evidence from China," International Review of Economics & Finance, Elsevier, vol. 88(C), pages 60-72.
  • Handle: RePEc:eee:reveco:v:88:y:2023:i:c:p:60-72
    DOI: 10.1016/j.iref.2023.06.006
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1059056023001740
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.iref.2023.06.006?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Liu, Zhiqiang, 2003. "The Economic Impact and Determinants of Investment in Human and Political Capital in China," Economic Development and Cultural Change, University of Chicago Press, vol. 51(4), pages 823-849, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Simon Appleton & John Knight & Lina Song & Qingjie Xia, 2009. "The Economics of Communist Party Membership: The Curious Case of Rising Numbers and Wage Premium during China's Transition," Journal of Development Studies, Taylor & Francis Journals, vol. 45(2), pages 256-275.
    2. Sangui Wang & Lijuan Zheng, 2024. "The Impacts of the Poverty Alleviation Relocation Program (PARP) on Households’ Education Investment: Evidence from a Quasi-Experiment in Rural China," Sustainability, MDPI, vol. 16(10), pages 1-23, May.
    3. McLaughlin, Joanne Song, 2017. "Does Communist party membership pay? Estimating the economic returns to party membership in the labor market in China," Journal of Comparative Economics, Elsevier, vol. 45(4), pages 963-983.
    4. Hou, Benyufang & Liu, Hong & Wang, Sophie Xuefei, 2020. "Returns to military service in off-farm wage employment: Evidence from rural China," China Economic Review, Elsevier, vol. 59(C).
    5. Yuanyuan Ma & Patrick Paul Walsh & Liming Wang, 2017. "Earnings Premium in State Jobs Across Urban China," Asian Economic Papers, MIT Press, vol. 16(2), pages 167-184, Summer.
    6. Markussen, Thomas & Ngo, Quang-Thanh, 2019. "Economic and non-economic returns to communist party membership in Vietnam," World Development, Elsevier, vol. 122(C), pages 370-384.
    7. Masami Imai, 2006. "Mixing Family Business with Politics in Thailand," Asian Economic Journal, East Asian Economic Association, vol. 20(3), pages 241-256, September.
    8. Liu, Zhiqiang, 2007. "The external returns to education: Evidence from Chinese cities," Journal of Urban Economics, Elsevier, vol. 61(3), pages 542-564, May.
    9. Yamamura, Eiji & Smyth, Russell & Zhang, Yan, 2015. "Decomposing the effect of height on income in China: The role of market and political channels," Economics & Human Biology, Elsevier, vol. 19(C), pages 62-74.
    10. Wang, Wen & Shi, Hongyu & Li, Qiang, 2023. "Pension gap between the Chinese public and nonpublic sectors: evidence in the context of the integration of dual-track pension schemes," International Review of Economics & Finance, Elsevier, vol. 85(C), pages 664-688.
    11. Maggie Xiaoyang Chen, 2013. "The Matching Of Heterogeneous Firms And Politicians," Economic Inquiry, Western Economic Association International, vol. 51(2), pages 1502-1522, April.
    12. Hongbin Li & PakWai Liu & Junsen Zhang & Ning Ma, 2007. "Economic Returns to Communist Party Membership: Evidence From Urban Chinese Twins," Economic Journal, Royal Economic Society, vol. 117(523), pages 1504-1520, October.
    13. Yang, Dennis Tao, 2005. "Determinants of schooling returns during transition: Evidence from Chinese cities," Journal of Comparative Economics, Elsevier, vol. 33(2), pages 244-264, June.
    14. Carl Shu-Ming Lin & Linxiang Ye & Wei Zhang, 2020. "Transforming informal work and livelihoods in China," WIDER Working Paper Series wp-2020-150, World Institute for Development Economic Research (UNU-WIDER).
    15. Tingqiu Cao & Xianhang Qian, 2021. "Political Capital and Household Income: Evidence from Twenty-Four Transition Countries," Journal of Family and Economic Issues, Springer, vol. 42(1), pages 151-165, March.
    16. Haojun Wang & Ying Wang & Bei Lyu & Yanchao Yang & Honghong Huang, 2023. "Military Experience and Individual Entrepreneurship—Imprinting Theory Perspective: Empirical Evidence From China," SAGE Open, , vol. 13(1), pages 21582440231, March.
    17. Markussen, Thomas & Ngo, Quang-Thanh, 2019. "Economic and non-economic returns to communist party membership in Vietnam," World Development, Elsevier, vol. 122(C), pages 370-384.
    18. Liwen Chen & Bobby Chung & Guanghua Wang, 2021. "Exposure to Socially Influential Peer Parents: Evidence from Cadre Parents in China," Working Papers 2021-052, Human Capital and Economic Opportunity Working Group.
    19. Li, Hongbin & Meng, Lingsheng & Wang, Qian & Zhou, Li-An, 2008. "Political connections, financing and firm performance: Evidence from Chinese private firms," Journal of Development Economics, Elsevier, vol. 87(2), pages 283-299, October.
    20. Liu, Zhiqiang, 2008. "Human capital externalities and rural-urban migration: Evidence from rural China," China Economic Review, Elsevier, vol. 19(3), pages 521-535, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:reveco:v:88:y:2023:i:c:p:60-72. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620165 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.