The Impact Of Household Debt On Residents Health From The Perspective Of Private Lending

In recent years,with the improvement of financial market and the continuous innovation of financial instruments,China's "structural de-leverage" strategy has emerged.While leveraging local governments and destocking real estate,the leverage ratio of the residential sector is rising.The data shows that as of the end of 2018,the balance of various household loans in China was about 47.88 trillion yuan,and the leverage ratio of residents has reached 53.19%.The continued increase in debt pressures in the residential sector has had a profound impact on the economy and society,including the impact on the health of residents.According to the life cycle hypothesis,debt plays an important role in smoothing consumption,improving individual welfare,and maximizing consumer effectiveness.However,the existing literature shows that liabilities also increase the financial pressure of individuals,which is not conducive to the physical and mental health of consumers and lower their welfare levels.In fact,the true level of household debt in China is much higher than the total credit of formal financial institutions,which is mainly due to the lack of consideration of private lending.China has been a "human society" since ancient times.There are many private loans for Chinese families,including borrowing money from relatives and friends.Private lending is an indispensable factor in the family asset portfolio.Then,what kind of level is the actual debt of urban and rural residents in China? Based on this,the first task of this paper is to estimate the true level of household debt in the case of considering private lending.This paper draws on Li Jianjun's(2006)non-economic factor absorption analysis,sample speculation method and Guo Pei(2004)'s supply and demand gap method,and also considers the debt level of P2 P network loans in the estimation of the above method.Because the current research on the impact of household debt on the health of residents is mainly from foreign scholars,it has not received enough attention in China.Moreover,the research is mostly analyzed from the perspective of pathology or psychology,and there is a lack of research based on economics.Therefore,the second task of this paper is to study the impact of household debt on the health of residents.This paper uses the relevant data of Peking University's “China Family Panel Studies”(CFPS)in 2010,2014 and 2016 to study the potential risks of high debts of households through the use of an Ordered Logit model.In particular,the high debt on the health level of residents may have negative effects,and finally put forward policy recommendations.Based on the above research,this paper draws the following conclusions:(1)This paper uses three methods to estimate private lending,and the results show that the total debt of private lending(including online lending)in 2010-2016 is about 13-29 trillion yuan,which is generally close to,but slightly lower than the family lending of formal financial institutions.The total amount shows that the current leverage rate of residents in China is far higher than the level of public data display,and may even be about twice the level of public data.From 2014 to 2016,the total amount of informal lending of rural residents was about 3.88-12.6 trillion yuan,even more than that of rural residents in formal financial institutions.Whether it is for the healthy operation of the macro economy or the asset allocation of the micro-family,it may lay a serious hidden danger,or even a potential crisis,especially in the case of the current relatively imperfect social security system in China.(2)Household debt have a significant negative impact on the health level of residents,that is,the higher the household debt,the worse the health level of the residents,and the long-term significant impact,indicating that high household debt will damage the health level of the residents.In the long term,although the negative effects are weakened,they still exist.(3)Through the empirical regression of bank loans and private lending,it is found that compared with bank loans,private lending has a greater negative impact on the health level of residents,and the effect is more significant.(4)Household debt has a significant negative impact on residents' mental health.The higher the household debt,the greater the frequency of residents' emotional depression and the worse their mental health.Moreover,the negative impact has a long-term nature,so it is more likely to induce mental illness of residents.(5)Through a separate inspection of bank loans and private lending,it is found that private lending has a greater negative impact on residents' mental health,and they are all highly significant.This shows that the negative impact of private lending on residents' mental health is more long-term than bank loans.To sum up,we believe that private lending accounts for a large proportion,which may lead to the persistence of potential risks in the whole society and cause a lot of negative effects on residents' health.Therefore,the government should vigorously develop inclusive finance,so that residents' financing needs more from informal finance to formal finance.At the same time,to achieve a healthy China,we must control the leverage ratio of the household sector in a reasonable level,especially curb the rapid growth of housing loans.