The Effect of Social Interaction on Household Commercial Insurance Purchases: Evidence from the China Household Finance Survey
LI Ding, DING Junsong, MA Shuang
Institute of Development Studies, Southwestern University of Finance and Economics; School of Social Development and Public Policy, Fudan University; School of Economics and Statistics, Guangzhou University
Summary:
As one of the three pillars of the modern financial industry, insurance plays an important role in economic compensation, capital financing, and social management, and it is known as the “patron saint” of socioeconomic development. Although China's commercial insurance market has developed rapidly over the past 40 years into the world's second largest insurance market, the insurance industry is still in the primary stage of development from the perspective of insurance depth and density. The literature generally points to limited participation among residents as an important reason that China's commercial insurance industry is not strong despite its large size. The key to solving the problem of limited participation is to identify factors that affect residents' purchasing of commercial insurance. At present, there are relatively few studies on the influence of social interaction on family commercial insurance purchases, and no consistent conclusions have been reached so far. To address this research gap, the present paper studies the influence of social interaction on family commercial insurance purchases and its channels using data from the China Household Finance Survey (CHFS) 2013. First, by selecting eight variables related to social interaction and using the iterative principal factor method, this paper constructs a comprehensive social interaction index. Second, Probit and Tobit models are used to conduct empirical analysis, and two channels are verified through the variables of financial knowledge and degree of trust in commercial insurance. Third, potential endogeneity problems related to social interaction are overcome by constructing instrumental variables, and heterogeneity analysis and robustness tests are conducted. Finally, based on tracking data from the 2013-2015 CHFS, logical problems related to the time inconsistency between social interaction and household commercial insurance purchases are overcome. The results show that social interaction promotes household purchases in the commercial insurance market, and the effect is still significant after solving the endogeneity problem. In addition, this paper confirms two channels of social interaction that affect commercial insurance purchases. According to heterogeneity analysis, social interaction plays a more important role in promoting insurance purchases among families in the eastern and central regions, those with medium levels of education, those with high income levels, and those in low-purchases-rate communities. The main innovations of this paper are fourfold. First, the use of CHFS data to examine the relationship between social interaction and household commercial insurance purchases allows our findings to be strongly representative, as the data span 29 provinces and more than 28,000 households. In this way, we avoid the drawbacks of previous studies that fail to provide a comprehensive picture of residents' insurance purchases in China. Second, by using the iterative principal factor method to construct a comprehensive social interaction index, we avoid the concern that a single variable cannot accurately describe social interaction. Third, by verifying two channels of social interaction's impact on household commercial insurance purchases, our paper allows for a more thorough understanding of the effect of social interaction. Finally, potential bias in regression results caused by endogeneity problems and time inconsistency is solved by constructing instrumental variables. This paper is the first to explore the development of China's commercial insurance market from the perspective of social characteristics. Efforts to promote insurance market development should go beyond economic factors and also recognize the importance of residents' social characteristics. Therefore, relevant agencies should pay attention to the role of social interaction in the development of insurance. It is also necessary to further standardize China's insurance market and strengthen the trust of commercial insurance conditions to improve the depth and breadth of insurance purchases and promote the industry's development.
李丁, 丁俊菘, 马双. 社会互动对家庭商业保险参与的影响——来自中国家庭金融调查(CHFS)数据的实证分析[J]. 金融研究, 2019, 469(7): 96-114.
LI Ding, DING Junsong, MA Shuang. The Effect of Social Interaction on Household Commercial Insurance Purchases: Evidence from the China Household Finance Survey. Journal of Financial Research, 2019, 469(7): 96-114.
[1]陈秉正,2018,《从保险大国到保险强国》,《保险研究》第12期,第68～72页。 [2]陈刚和李树,2012,《政府如何能够让人幸福？——政府质量影响居民幸福感的实证研究》,《管理世界》第8期,第55～67页。 [3]樊纲治和王宏扬,2015,《家庭人口结构与家庭商业人身保险需求——基于中国家庭金融调查(CHFS)数据的实证研究》,《金融研究》第7期,第170～189页。 [4]甘犁、尹志超和谭继军,2014,《中国家庭金融调查报告2014》,西南财经大学出版社,,第212～217页。 [5]郭士祺和梁平汉,2014,《社会互动、信息渠道与家庭股市参与》,《经济研究》第s1期,第116～131页。 [6]何兴强,李涛,2009,《社会互动、社会资本和商业保险购买》,《金融研究》第2期,第116～132页。 [7]李涛,2006a,《社会互动、信任与股市参与》,《经济研究》第1期,第34～35页。 [8]李涛,2006b,《社会互动与投资选择》,《经济研究》第8期,第45～57页。 [9]刘坤坤、万金和黄毅,2012,《居民人身保险消费行为及其影响因素分析》,《保险研究》第8期,第53～59页。 [10]马光荣和杨恩艳,2011,《社会网络、非正规金融与创业》,《经济研究》第3期,第83～94页。 [11]蒲成毅和潘小军,2012,《保险消费促进经济增长的行为金融机理研究》,《经济研究》第s1期,第139～147页。 [12]秦芳、王文春和何金财,2016,《金融知识对商业保险参与的影响——来自中国家庭金融调查(CHFS)数据的实证分析》,《金融研究》第10期,第143～158页。 [13]宋涛、吴玉锋和陈婧,2012,《社会互动、信任与农民购买商业养老保险的意愿》,《华中科技大学学报:社会科学版》第1期,第99～106页。 [14]孙祁祥和王向楠,2013,《家庭财务脆弱性,资产组合与人寿保险需求: 指标改进和两部回归分析》,《保险研究》第6期,第23～34页。 [15]孙武军和高鹏,2015,《“新国十条”与保险业“生态环境”建设》,《保险研究》第4期,第72～78页。 [16]王春超和张呈磊,2017,《子女随迁与农民工的城市融入感》,《社会学研究》第2期,第203～228页。 [17]王思斌,2010,《社会学教程》,北京大学出版社,第74～75页。 [18]温忠麟、张雷、侯杰泰和刘红云,2004,《中介效应检验程序及其应用》,《心理学报》第5期,第614～620页。 [19]吴玉锋和孙金岭,2015,《社会互动、信任与农村居民养老保险参与行为研究》,《华中科技大学学报(社会科学版)》,第3期,第98～105页。 [20]杨汝岱、陈斌开和朱诗娥,2011,《基于社会网络视角的农户民间借贷需求行文研究》,《经济研究》第11期,第116～129页。 [21]张冲,2013,《中国人口结构对人身保险市场发展的影响研究》,《保险研究》第4期,第63～70页。 [22]宗庆庆、刘冲和周亚虹,2015,《社会养老保险与我国居民家庭风险金融资产投资》,《金融研究》第10期,第99～114页。 [23]Albouy, F.X., and D.Blagoutine, 2001, “Insurance and Transition Economics: The Insurance Market in Russia”, Palgrave Macmillan Journals, 26(3): 467～479. [24]Beiseitov, E., J.D.Kubik, and Moran J.R.,2004, “Social Interaction and the Health Insurance Choices of the Elderly”, Center for Policy Research Working Papers. [25]Bommier, A. and F. L. Grand, 2014. “Too Risk Averse to Purchase insurance？”, Journal of Risk & Uncertainty, 48(2):135～166. [26]Cluster, D.M. and K.Mcgarry, 2008, “Preference Heterogeneity and Insurance Markets: Explaining a Puzzle of Insurance”. American Economic Review, 98(2):157～162. [27]Du, Zaichao, Jiannan Guo, and Lin Zhang, 2014, “Guanxi and Income Inequality”, Working Paper. [28]Durlurf, S.N., 2004, “Neighborhoods Effects”, Working Papers, 4(1):343～362. [29]Fu, S. , Y. Liao , J .Zhang,2016, “The Effect of Housing Wealth on Labor Force Participation: Evidence from China”, Journal of Housing Economics,33(9):59～69. [30]Hong, H., Kubik J.D., and Stein J.C.,2004, “Social Interaction and Stock-Market Participation”, The Journal of Finance, 59(1):137～163. [31]Michaud, P.C., and A.V.Soest,2008, “Health and Wealth of Elderly Couples: Causality Tests Using Dynamic Panel Data Models”, Journal of Health Economics, 27(5):1312～1325. [32]Rooij, M,A. Lusardi, R. Alessie,2011, “Financial Literacy and Stock Market Participation”, Journal of Financial Economics,101(2):449～472. [33]Showers, V.E., J.A.Shotick, 1994, “The Effects of Household Characteristics on Demand for Insurance: A Tobit Analysis”, Journal of Risk and Insurance, 61(3):492～502. [34]Becker, G.S., 1991, “A Note on Restaurant Pricing and Other Examples of Social Influence on Price”, Journal of Political Economy, 99(5):1109～1116. [35]Stock, J.H. and M.Yogo ,2005, “Testing for Weak Instruments in Linear IV Regression”, NBER Technical Working Papers, 14(1):80～108.
