The Impact Of Social Network And Human Capital On Financial Market Participation Of China Urban Family

Based on the 2010 China Family Panel Studies, this paper focuses on the financial market participation of Chinese Urban Household from the perspective of Social Network and Human Capital. In this paper, Social Network is divided into Weak Tie of Social Network and Strong Tie of Social Network, according to different formations. A further study shows that, Strong Tie of Social Network, which represents the traditional patriarchal clan, significantly hinders household from engaging in the financial market, and may reduce the depth of Urban Household financial market participation as well. Weak Tie of Social Network, which is to communicate with each other and to disseminate information, has significant positive effect on Urban Household Participating and the probability of deepen financial market engagement. In general, Social Network shows positive effect on the Chinese Urban Household Financial Market Participation. Human Capital, the influence of age on the Household Financial Market Participation is an inverted U type, there is a threshold, if the householder is younger than a certain age, the Household Financial Market Participation growth with the age. When the age of householder is older than the threshold, age hinders the Household Financial Market Participation. At the same time, this paper also found that the more education, it will give household greater access to financial market. And the householder’s gender also influences the Household Financial Market Participation. When the householder is male, it will reduce the participation of household to the financial market. The results of this study make some useful attempts to understand the household financial activity and promote Household Finance development.