| During the transitional period, a series of economic phenomena exist in the rural households credit market that are worth our attention: (1) the proportion of rural households loans in formal financial institutions is on the decline while that in informal financial institutions is constantly increasing; (2) among the formal rural households credit market, different financial institutions take different attitudes of participation. State-owned commercial banks choose to withdraw from the market while rural credit cooperative increases to invest in this field. (3) Great rate differentials exist in different regions. There are mutual-aid zero interest rates, medium interest rates in financial institutions, and also high rates of private credit. Then, why is it difficult for farmers to gain support from formal financial institution? What is the basis for the rapid growth of informal rural credit? What policies should government adopt in this field?This thesis makes a theoretical discussion and explanation on the above questions from a micro perspective in terms of demand and supply of credit with empirical evidence from Fujian Province. Centered on these questions, this thesis makes analysis mainly from three aspects. Chapter Four gives a theoretical explanation and demonstrative observation on the occurrence mechanism, major characters and influence factors of the demand of rural credit. Chapter Five makes a theoretical explanation on different participation attitudes that financial institutions take in rural credit market and gives a specific analysis of factors influencing rural credit by using the systematic data from r rural households credit cooperative in Fujian Province. Chapter Six gives a theoretical explanation on the preset situation and future development of informal rural households credit market and an analysis of the complex rate differentials with evidence from a specific village.In Chapter Four, some conclusions are reached through theoretical explanation and metric model analysis: (1) during the transitional period, due to relatively low income and deposits of rural households, the imbalance of income distribution in different seasons and years and relatively stability of payout constitute the major reasons for demand of rural credit; (2) on the basis of re-categorization of demands, we believe, apart from demand on non-agricultural industry credit, all the others share the property of rigidity and insensitivity to interest rate. Therefore, the interest rate in rural households credit market mainly depends on the supplier. We find this conclusion can explain the various features of interest rates in different rural areas. (3) Evidence proves that rural households meet with severe limitations in the credit are and the credit from both formal and informal financial institutions can' t satisfy their needs; on account of difference in information structure, the informal financial institutions are more favorable in determining whether to provide the farmers with credit from their family features compared with formal ones.Chapter Five points out that (1) asset choice behavior under the financial regulation constituents the major reason for the withdrawal of commercial banks and the increasing input of rural credit cooperative. Considering the lower costs and risks in the paralleling credit markets in urban area and large or medium enterprises, commercial banks decide to withdraw from the rural credit market. As for rural credit cooperative, due to the limitations of branches and funds, it aims mainly at farmers or small enterprises. In order to reduce the risks, it increases the input in farmers' credit; (2) the farmers' credit behavior of rural credit cooperative is subject to the influence of credit capacity, credit willingness and policies. Our evidence has proved that rapid growth in deposits, the promotion of policies and comparatively higher risks of other credits exert positive effects on rural credit; impotency in liquidity management and high costs in administration play a negative role.Chapter Six explains the reasons for the existence and predominant position of informal rural households credit and the complexities of interest rates in informal rural households credit market and research the operation mechanism of informal finance from a positivist perspective with a case study of "Rotating Savings and Credit Association (ROSCA) " . This case study shows that, (1) the inadequacy of service in the formal financial institution constitutes the key cause of ROSCA and the reasons for villager' participation in it are related to all aspects of production and life; (2) the inherent discrimination, selection and flexible security mechanisms, along with mutual mechanism and social punishment mechanism make an important guarantee and lay a foundation for the successful operation of ROSCA; (3) under the circumstances of lack of agricultural insurance system, the natural risks and market risks in agricultural production tend to transform into credit risks; (4) there is a range of rate differentials in the ROSCA but on the whole, the overall level is higher than that in formal financial institution.In conclusion, this thesis puts forward that the following measures should be taken to solve the rural credit problems: the information supply for rural households credit market should be strengthened, the rural pledge be extended; a multi-layer rural financial institution system should be established; the marketization of rural interest rate should be accelerated; deposits insurance system should be built up and rural financial law improved; the service of government and intermediary organizations should be intensified; a trade market with rural elements should be set up, the income for farmers should be increased and the instability of their income should be reduced. |
