LU Yajuan, CALUM G.Turvey:The Influencing Factors and Urban-Rural Differences in the Behavior of Household Risky Assets Holding in China

Abstract  Currently, it is a critical period of economic transition for China.With the imbalance of economic development and the urban-rural income gap, China's financial industry shows strong characteristics of dual economic structure, which lies in a series of huge differences, such as those within financial development, financial products and the proportion of risky assets held by residents between urban and rural areas.This paper explores the influencing factors on the proportion of risky assets held by the urban and rural households in China by using original survey data from the China Household Finance Survey on 7331 households in 2011.Econometric results confirm that the demand for income, risk preferences, social security, family size, age and other factors exert significant impact on the proportion of household risky assets holdings, and that there is a significant difference between urban and rural household risky asset holdings.In addition, this paper offers proposals and suggestions to governments, and financial institutions.

Source: Finance & Trade Economics , No.9, 2014