An Economic Analysis of the Vicissitude of the Temple Finance in China’s Mediaeval Ages
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| Title | An Economic Analysis of the Vicissitude of the Temple Finance in China’s Mediaeval Ages
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| Author | Zhou Jianbo,Zhang Bo and Zhao Yuheng |
| Organization | Peking University; Beihang University |
| Email | bozhang@pku.edu.cn；zhoujiantaoa1032@buaa.edu.cn；henrybowen@163.com |
| Key Words | Buddhist Fanaticism; Temple Finance; Business Credit; Donation |
| Abstract | The temple finance in mediaeval ages maintained its business credits through the spreading of Buddhist faith, namely, it relied on Buddhist faith to mobilize social capital and constrain the behaviors of borrowers, which was the main difference from local finance. This feature also made temple finance vigorous and booming throughout the Buddhist fanaticism in the Northern and Southern Dynasties, and became the first financial institution with significant influence in Chinese history of financial development which lent money based on social capital. The same feature also made temple finance declined rapidly with the cooling of Buddhist fanaticism after the middle period of Tang Dynasty. By establishing the canonical modern economics model, this paper investigates how the rise and fall of Buddhist fanaticism influence the development of temple finance. We find that establishing business credits through religious belief is not enough. To enhance the capacity of building business credits, strengths from secular factors like kinships and law from government are indispensable, which is exactly the development direction of Chinese financial industry after the middle period of Tang Dynasty. |
| Serial Number | WP1335 |
| Time | 2019-02-18 |
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