The Rural Financial Support To Chinese Agricultural Modernization

From a global perspective, there is an increase in food production, but with increasingly harsh climate and increasing population, there are still some areas of the world facing the threat of famine. China also needs some agricultural imports to meet food needs. So food security was placed in strategically important position. China has also developed a "self-sufficiency" goal. From the point of view of the development stage, after the establishment of China rehabilitation, national development policies tend to promote economic development of the secondary industry, resulting in rural and urban dual economic issues outstanding, and urban-rural income gap is very obvious. Agricultural Modernization has become China’s four modernizations weakest link. In order to achieve industry nurturing agriculture", all kinds of production gradually flows from urban to rural areas. Among them, the financial played in promoting regional economic development role, can gather a lot of money for the financial industry, the funds will be absorbed for agricultural development, and guide effective sector capital flows, and risk sharing. While agriculture wants to be Scale, mechanization, electrification, not only to need financial support but also thanks to the financial linkage effects brought. However, there still are problems in the rural financial support for agriculture, Such as fatigue, lack of innovation, high transaction costs and risks.Based on the mechanism of action Pagano model and financial support for regional economic development, We take the savings rate, the ratio of savings into investment, the marginal productivity of capital as arguments of rural finance; Through 12 individual indicators index system to build a modern agriculture, based on 1990 to 2013 data to calculate the overall level of development of agricultural modernization, and as the dependent variable. Empirical results show that the rural finance for agricultural modernization does play a supportive role, but the effects of three pathways are different. The coefficient of Savings rate and ratio of savings into investment are Significant, indicating a positive supporting role is obvious, but the marginal productivity of capital has little effect, that is we should focus on.According to the empirical results, the article concludes with suggestions to strengthen the rural financial support for the development of agricultural modernization, and corresponding financial support for the modernization of agriculture in rural areas of the three modes of action: First, the establishment of appropriate competition rural financial system, to fully absorb the rural savings; through direct financing and indirect financing continue to enrich and deepen the development of intense competition will inspire even Forced various financial institutions to raise the ability of capital accumulation. Second, Rural financial service model of continuous improvement, guidance deposits converted into agricultural investment; Bank to improve the operating efficiency and covering area, both large and small enterprises, and guide funds to invest in agriculture through innovative service model and system. Third, expand rural financial investment channels, improve the marginal productivity of capital; the development of the investment market is not saturated, not only to protect the marginal productivity of financial capital, but also to promote the diversified development of the rural economy.