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The Impact Of Social Capital On Bank Risk-Taking, Wenjing Xie
The Impact Of Social Capital On Bank Risk-Taking, Wenjing Xie
Theses & Dissertations
The concept of “social capital” has received considerable attention these years. Yet, few studies have explored the connections between social capital and bank risk-taking. In this study, I discuss the theory of social capital and its relevance to financial market behavior, and then I analyze the relationship between social capital and bank risk-taking across countries. To measure social capital, I follow Knack and Keefer (1997) and use the data of trust and civic norms collected from the World Values Survey. My measure of bank risk-taking is the nature logarithm of Z-score of each bank. Empirical results show that bank risk-taking …