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Social Network and the Sustainable Development of Microfinance in China
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TitleSocial Network and the Sustainable Development of Microfinance in China  
AuthorSu Dongwei, Chen Chunchun,Xu Zhenguo and Li Bin  
OrganizationJinan University 
Key WordsSocial network, Microfinance, Inclusive financial system, Microcredit loans, Commercial banks 
AbstractHow to improve social performance and sustainability of microfinance towards an inclusive financial system has been an unresolved problem in social sciences. This paper is one of the first to apply social network analysis to studies of microfinance development. Building a set of 9 indicators grouped undernetwork structure, network types and relationship attributes, we create an innovative measure of social network for commercial banks. Then we obtain data from 316 valid questionnaires through surveys among subsidiaries of a major commercial bank in Guangzhou, China. We seek answers on whether and to what extent social networks affect social performance and sustainability of microfinance development. We find that both network types and relationship attributes help improve social performance of microfinance. In particular, friendship network and supportive network are positively related to the number of microfinance loans, commercial network is negatively related to the amount of microfinance loans per person but positively related to the income from microfinance loans. In addition, relationship attributes help increase the per capita microfinance loans. However, network structure doesn’t affect the social performance and sustainability of microfinance. Our results indicate that by actively expanding social network resources and establishing mutually beneficial long-term trust with all stakeholders, financial institutions can continue to provide innovative products to support sustainable development of microfinance and improve allocative efficiency of the society and economy. 
Serial NumberWP1229 
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