The Impact of Digital Financial Development on the Accumulation of Social Capital among Residents:Evidence from Chinese Family Panel Studies
Breaking through the limitations of traditional social"differential order pattern"networks and improving people's well-being and comprehensive development are the key channels to achieve common prosperity.Under the back-ground of common prosperity in China,to explore the action mechanism of financial development on residents'social capital accumulation is the due meaning of adhering to the people-centred development thought and promoting common prosperity in high-quality development.Based on the theory of social capital,this paper divides social capital into tradi-tional social capital,cross-regional social capital and virtual social capital according to the social radius and the closeness of ties.Using the data from China Family Panel Studies in 2014,2016 and 2018,this paper systematically examines the impact of digital finance development on residents'social capital accumulation and its differentiated effect from four di-mensions:traditional social capital,cross-regional social capital,virtual social capital and the transformation of social capital from virtual to real.The results show that digital finance reduces residents'traditional informal lending by improving credit availability and preference for formal financial financing and promotes the accumulation of traditional social capital by improving inter-personal consumption and economic assistance behaviours among relatives and friends.Digital finance influences resi-dents'migrant work decisions by broadening information channels,enhancing financial capital and social trust,and pro-moting the accumulation of cross-regional social capital.Digital finance extends the scope of interpersonal interaction and economic transactions to the virtual network,promotes residents to accumulate virtual social capital by broadening infor-mation channels,strengthening social trust and facilitating internet-based business transactions,further significantly in-creasing the transformation of social capital from virtual to real through the mechanisms of"chatting with net-friends on the phone"and"meeting net-friends offline".Heterogeneity analysis shows that,compared with agricultural workers,non-agricultural workers,equipped with financial literacy and job advantages,can better utilize digital financial services to accumulate traditional,cross-regional and virtual social capital and realize the transformation of social capital from virtual to real.As for cultural background differences,digital finance significantly boosts the growth of traditional social capital accumulation in regions with strong family culture,while in regions with weaker family culture influence,digital finance aids residents in accumulating cross-regional and virtual social capital through the mechanism for strengthening social trust.The marginal contribution of this paper is mainly reflected in the following aspects:Firstly,it responds to the contro-versy about the virtual and real transformation of social capital from the perspective of the"social network"effect of digi-tal finance:digital finance is a paradigm of"internet+finance"and has Internet characteristics.Most studies on the im-pact of the Internet on the total amount of social capital assume that virtual social capital can be spontaneously trans-formed into real-world social capital,but whether this premise is true remains controversial.The empirical results of this paper confirm that virtual social capital can be effectively transformed into real-world social capital under the effect of digi-tal finance.Secondly,in the existing research,many scholars primarily focus on the functional role of social capital while relatively ignoring the research on the accumulation and formation mechanism of social capital.This paper clarifies how the development of digital finance affects the accumulation of residents'social capital and its action path by examining four dimensions:traditional social capital,cross-regional social capital,virtual social capital and the transformation of so-cial capital from virtual to real,which helps to enhance the effectiveness of digital finance policy to improve the level and structure of social capital.In addition,studying social capital accumulation from the perspective of the macroenvironment(digital finance development)can help solve the endogeneity problem of social networks.Thirdly,the existing literature has proved that digital finance plays a social function in terms of creating opportunities,improving equity,eliminating poverty and narrowing the income gap.This paper provides empirical evidence of China's experience of the"social net-work effect"of digital finance,enriches the understanding of the social function of digital finance in China,and provides a policy reference for how the current financial supply-side reform can achieve common prosperity for residents.
Digital FinanceSocial Capital AccumulationTransformation of Social Capital from Virtual to Real
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