Research On The Impact Of Internet Use On Household Financial Vulnerabilit

Financial risks have always been an important issue that plagues my country’s sustainable and healthy development.Since the 18 th National Congress of the Communist Party of China,the country has attached great importance to financial risks,and has always regarded "the bottom line that keeps systematic financial risks" as the eternal theme of future financial work.Family financial risks are an important part of financial risks.Maintaining family financial security is both the basis for maintaining the stability of the financial system and the prerequisite for promoting the rapid development of the national economy.As an important form of family asset allocation,financial asset investment can not only increase family property income,but also further improve the persistence of family finance.However As a result,the fragility of family finance continues to deteriorate.In recent years,my country’s Internet penetration rate is constantly rising,and the window of digital dividends has also ushered in new opportunities for family participation in the financial market,and it is gradually becoming a new driving force to reduce family financial vulnerability.Therefore,how to use Internet channels to effectively reduce family financial vulnerability is a problem that we need to solve.Studying the impact of Internet use on family financial fragility will help enhance the attention of all sectors of society to the vulnerability of family finance,enhance the enthusiasm of families to actively use the Internet to participate in the financial market,thereby reducing family financial fragility and preventing financial risks.This paper uses the 2019 micro-survey data of the China Household Finance Survey to explore household financial vulnerability as the explanatory variable and the Internet as the explanatory variable,as follows:(1)After combing the relevant literature,the entropy value method is used to construct the household financial vulnerability index from the perspective of financial decision-making;(2)Benchmark regression model,mediation effect model and moderating effect model were constructed,and the impact and mechanism of Internet use on household financial vulnerability were empirically tested;(3)endogeneity and robustness tests were used to further verify the robustness of the regression results;(4)explore the heterogeneous impact of Internet use on household financial vulnerability by grouping by age,years of education,and urban and rural areas;(5)Put forward policy recommendations to reduce household financial vulnerability based on the three levels of government,financial institutions and households.The research conclusions of this paper are as follows:(1)Internet use can alleviate household financial vulnerability,and the above conclusions are still true after endogenous tests(instrumental variable method)and robustness tests(replacing explanatory variables,replacing explanatory variables,replacing data sets);(2)the mechanism analysis found that,on the one hand,Internet use alleviates household financial vulnerability by improving financial literacy;On the other hand,the risk appetite of household heads promotes the mitigating effect of Internet use on household financial vulnerability.(3)The results of heterogeneity analysis show that the mitigating effect of Internet use on household financial vulnerability is more significant among young people,highly educated heads of households,and urban households.Based on the above conclusions,this paper puts forward policy suggestions to alleviate household financial vulnerability from the government,financial institutions and households.At the government level,the following measures should be taken: first,strengthen the supervision of Internet information security and optimize the network information environment;Second,introduce preferential policies and do a good job in interpreting and publicizing financial policies;Third,carry out regular education on financial knowledge and improve the level of financial literacy of residents.At the level of financial institutions,the following measures should be taken:first,Actively promote financial knowledge and improve the level of financial literacy of residents;Second,actively expand consulting services and build an information sharing platform;Third,strengthen financial supervision and effectively protect the rights and interests of consumers.At the household level,the following measures should be taken: first,enhance risk prediction capabilities and financial risk awareness;Second,expand social networks and accumulate social capital;Third,improve the level of family financial literacy and build an efficient asset portfolio.