Can credit affect social stability? To answer this question, we turn to a natural experiment from 1930s China, where credit contracted as a consequence of the 1933 U.S. Silver Purchase program. Building on extensive archival information, we assemble a novel, hand-collected data set of loan contracts to individual firms as well as labor unrest episodes. We show that the Silver Purchase shock res...

Peer-to-peer lending platforms such as Prosper Marketplace facilitate lending by matching potential borrowers with potential lenders using an auction mechanism. Borrowers can post loan requests and lenders can bid on a request specifying a minimum interest rate and an amount they are willing to lend. In this paper we analyze the impact of social information on the interest rate of funded loans ...

Smart city construction emphasizes building an effective whole social credit system, promoting the construction of government integrity, business integrity, social integrity and public confidence in the judiciary. For credit risk has become an important assessment. Meanwhile, administration credit system is one of three major data. It proposes unified credit discipline and warning regulatory pu...

This paper examines the effects of tying microenterprise credit cooperatives (or “village banks”), with health and education services, using data from two Latin American countries, Ecuador and Honduras. Credit constraints particularly affect women (microentrepreneur) borrowers. Evidence suggests that mothers’ income increases are more likely to be spent on nutrition and other health improving e...

While a rapidly growing body of research underscores the influence of social capital on financial decisions and economic developments, objective data-based measurements of social capital are lacking. We introduce average credit scores as an indicator of a community’s social capital and present evidence that this measure is consistent with, but richer and more robust than, those used in the exis...

Trust and reciprocity have been recognized as a means of reducing transaction cost and achieving mutually beneficial outcomes when legal contracts and third-party enforcement are absent or too costly. Some economic activities require trust and reciprocity among agents who are not familiar with each other and only have economic interactions at randomly determined times. One example is e-commerce...

In countries where citizens have strong grievances against the regime, attempts to address these grievances in the course of daily life are likely to entail high costs coupled with very low chances of success in any meaningful sense; consequently, most citizens will choose not to challenge the regime, thus reflecting the now well-known collective action problem. When a regime commits electoral ...

Academic and political discussions about micro-finance have been found lacking in predictive power, because they are based on orthodox economic theory, which does not properly comprehend the social components of credit. I take a better approach, utilizing credit theory--specifically, Ingham's explication of how the nature of money as credit leads to social inequality. I also expound the perspec...

Online social lending is the Web 2.0’s response to classical bank loans. Borrowers publish credit applications on websites which match them with private investors. We point to a conflict between economic interests and privacy goals in online social lending, empirically analyze the effect of data disclosure on credit conditions, and outline directions towards efficient yet privacy-friendly alter...