Reform of the shareholding system for collective assets,residents' participation,and community debts risk

The reform of the shareholding system for collective assets (SSCA) has made clear the community members' rights to collective assets and their possessory rights, while changes in the residents' rights may alter their behaviors and community interests. In this study, the Difference-in-Differences estimation method is used to examine the impact of the SSCA reform on residents' participation in community governance. With residents' participation as the mediating factor, the mediating effect model is used to study the impact of the reform on community debts risk (CDR). When the household, community, and economic variables are controlled, the probability of residents in communities that have undergone reform being willing to participate in community governance is 5.6% higher than those in communities that have not. The results are significant at the 5% level. In terms of CDR, the SSCA reform has significantly reduced the debts–assets ratio by 7.9%. These findings have passed a series of robustness tests. This conclusion provides new ideas for promoting communities' democratic participation and debts risk management.