Family entrepreneurship and regional digital finance access: evidence from household entrepreneurship in China

Using data from the China Household Finance Survey (CHFS) conducted in 2015, 2017, and 2019, in conjunction with the regional digital financial inclusion index developed by Peking University, we investigate the influence of regional digital finance accessibility on Chinese household entrepreneurship. The findings reveal that households in regions with better digital finance access exhibit a greater inclination towards household entrepreneurship. Among the – sub-indicators, the breadth of coverage and the use of credit exert the most significant influence. Furthermore, by employing casual mediation analysis in instrumental variable settings, we find that the physical bank outlet networks act as a negative transmission mechanism in the relationship between regional digital finance access and household entrepreneurship. This negative mediation effect amplifies with the proliferation of bank outlets. Heterogeneity analysis shows that the positive impact of regional digital finance access is particularly significant among households without commercial insurance and financial literacy. We recommend that governments advocate broader commercial insurance access and promote financial literacy in communities.