The Research On The Relationship Between Rural Financial Service And Rural Economy

The relationship between rural finance service and rural economic growth, which has always been noticed by domestic and foreign scholars. We must try to build a relatively perfect and suitable rural financial system, which is in order to promote rural economy run more fast, health and sustainable, but also to achieve the stable and harmonious of the rural society. From an overall perspective, both of rural economy and finance service have developed fast and rapidly in Jiangsu province. As the rural economics system reform goes further, it is the very task to the government of Jiangsu, for example, how to give full play to rural finance services rural economy, and to solve the existing problems in rural finance service, in order to achieve a harmonious development between rural finance and rural economy.Although the rural finance reform has achieved remarkable results in Jiangsu province, the rural economy has also developed effectively, the development speed of each distinct is shown differently. For instance, the relative lack of rural financial resources, the power of guarantee institutes is not very strong, the rural finance service's level is not so consummate, and so on. Therefore, it is urgent to improve the further investigate and research to enhance the level of rural finance service, in order to exert its function of rural economy.This paper take Jiangsu province as the background, select Suzhou, Nantong, Xuzhou on the behalf of the southern, middle and northern of Jiangsu province respectively. The empirical research based on VAR model, using the data which is from 1990 to 2008 of the three city and one province, operating the unit root test, cointegration test and granger causality test respectively. The results are totally different. From now on, Jiangsu province should according to different characteristics in various areas of it, propel the rural financial service reform steadily, improve the construction of rural finance service system, raise money supply to settle the problem of financial straits, and draw lessons from foreign successful experience, such as establish private insurers, give service to the agriculture, the village and the peasantry jointly.