Finance, Social Interactions, and Human Capital Development

35 Pages Posted: 21 Jun 2021

See all articles by Qing Hu

Qing Hu

Renmin University of China - School of Finance

Ross Levine

University of California, Berkeley - Haas School of Business; National Bureau of Economic Research (NBER)

Chen Lin

The University of Hong Kong - Faculty of Business and Economics

Mingzhu Tai

The University of Hong Kong, Faculty of Business and Economics

Date Written: June 19, 2021

Abstract

What is the impact of credit conditions on family interactions and children’s human capital development? We discover that regulatory reforms that ease credit conditions are associated with (1) increases in labor demand and the employment of mothers from low-income families, (2) decreases in parent-child discussions about school, reductions in parental supervision, and increases in children’s TV watching and video game playing among low-income families, and (3) declines in the time that children spend on homework and children’s academic performance among those same families. Effective substitutes for parent-child interactions, such as grandparents living in the household, mitigate these effects.

Keywords: Credit constraints; Social finance; Demand and supply of labor; Human capital accumulation

JEL Classification: G28; G41; J23; J24; I2

Suggested Citation

Hu, Qing and Levine, Ross Eric and Lin, Chen and Tai, Mingzhu, Finance, Social Interactions, and Human Capital Development (June 19, 2021). Available at SSRN: https://ssrn.com/abstract=3870285 or http://dx.doi.org/10.2139/ssrn.3870285

Qing Hu

Renmin University of China - School of Finance

Ming De Main Building
Renmin University of China
Beijing, Beijing 100872
China

Ross Eric Levine

University of California, Berkeley - Haas School of Business ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Chen Lin

The University of Hong Kong - Faculty of Business and Economics ( email )

Pokfulam Road
Hong Kong
China

Mingzhu Tai (Contact Author)

The University of Hong Kong, Faculty of Business and Economics ( email )

8th Floor Kennedy Town Centre
23 Belcher's Street
Kennedy Town
Hong Kong

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