A Study on the Effect of Ethnic Chinese Networks on the International Trade of China

Abstract

The role of business and social networks in promoting international trade has attracted increasing research in recent years. The Ethnic Chinese Network (ECN) is the most representative business and social network since it is much easier to identify their members. China has the most well-known ethnic networks actively in international trade today.

What mechanisms have made ECN facilitate bilateral trade? ECN working as a loose network to collocate resource between market and enterprise has a particular mechanism. This paper will introduce the particular mechanism of ECN, letting us know the role ECN and overseas Chinese communities promoting bilateral trade.

Most international trade into China belongs to members of Ethnic Chinese Network (ECN). Is there a significant positive role in China's trade of ECN? This paper empirically investigates the role of ethnic Chinese networks in promoting international trade of China. At the same time we will introduce the formation, characteristic and function of ECN, analyzing the crucial role of ECN (working as social capital) in promoting bilateral trade.