Theoretical And Empirical Study On Influence Of Financial Development On Farmer Income Increase In China

This paper intends to analyze the influence channels and influence extent of flanancial development on fanner income increase in China. With the fast development of the economy, the urban-rural income gap is becoming larger and larger during the reform and open period .Especially after 1990, the farmer income has been increasing slowly, and the urban-rural income gap problem is becoming more and more serious. Lowering the urban-rural income gap is not only the key of solving the agricultural problem, but also the key of our whole ecominc growth and development. As long as the farmer income has been really improved, we can eventually change the side effect of the urban-rural income gap on the ecominc growth and development.The channels of increasing farmer income include developing the rural factor market, moving the rural labors, stabilizing the agricultural industry, and all of the above depend on the rural financia development and the urban financial development. However, analyzing the index of China's economic and financial development, we can find that with the quick development of China's economic and urban financial development, the farmer income has been grown slowly. According to the analysis of the source structure of farmer income, the fanner income from wages and salaries has been playing a more and more important part in the whole farmer income.Therefore ,all the factors that influence the fanner income from household operations and farmer income from wages and salaries will togther determine the farmer income. This paper finds that not only the rural fiancial development but also the whole financial development will influence the farmer income by different channels and has made an empirical research on the influence mechanism.The innovation of this paper is that we put the urban financial development into the the analysis framework. The rural fiancial development mainly influences the farmer income from household operations and the urban financial development mainly influences farmer income from wages and salaries. This paper has seperataly given the theretical model of rural fiancial development influencing the farmer operating income and the urban financial development mainly influencing the farmer salary income. This paper has also used the statistical data to make an empirical research.The research thought of the whole paper is from circumstance description to the theoretical mdel to the empirical study .The main content is the following.Firstly, this paper theoretically anylayzes the the effect of fianancial development on farmer income increase. The double sides of financial development institution and financial development structure are the deep cause of the rural financing difficulty. This paper has seperataly given the theretical model of rural fiancial development influencing the farmer income from household operations and the urban financial development mainly influencing farmer income from wages and salaries. The lag-behind of the rural fiancial development has greatly influenced the farmer income from household operations, and the the urban financial development and the urban economic development has critically improved the farmer income from wages and salaries. In the influencing factors of farmer income, the accumulation of rural physical capital, the rural human capital, the industry structure and and the rural labors transfer are the direct factors. The rural fiancial development and urban financial development influence the fanner income by influencing the above direct factors.Secondly, this paper analyzes the process of the Cinese farmer income and the source structure. In the early period of the reform and open era, the farmer income has stably and quickly increased. However, in recent years, the farmer income has slowly increased. The farmer income from household operations and farmer income from wages and salaries are the majority of the farmer income.Thirdly, this paper has measured the farmer inome, rural fiancial development and urban financial development. This paper has used the statistical data to make an empirical research on the effect of rural fianancial development and urban financial development on farmer income increase. This paper has used the data to examine the effect of rural physical capital investment, the rural human capital, the industry structure and and the rural labors transfer on Chinese farmer income; and then examines the effect of rural financial development and urban financial development on the rural physical capital investment, the rural human capital, the industry structure and and the rural labors transfer; and lastly examines the effect of rural financial development and urban financial development on the farmer income with regional statistical data.Lastly, this paper gives the relative results and policy suggestions. Therefore, in order to guide the balanced development of financial industry and reduce urban-rural income disparity, measures such as strengthening the rural financial property rights, lowering the threshold for financial services, developing new kinds of rural financial institutions and micro-credit, deepening the rural credit unions reform, promoting competition and complementarities between formal finance and informal finance, and preventing the further loss of rural financial resources should be taken.