The Research About Construction Of The Rural Financial System

According to the data of China Statistical Yearbook in 2007, the proportion of China's rural population accounts for 55.06% of the whole population. As an agricultural country, reasonable construction of the rural financial system, is related to coordinated and healthy development of our national economy, is related to the realization about goals of building a well society totally, rural economic growth, and improvement of farmers' living standards. Therefore, this paper studies about construction of the rural financial system. Firstly, making definition of the rural financial system and structure clear is necessary, then through its developing history, learn about content and effectiveness of innovation for the rural financial system in the different stage.Undeniably, the rural financial system, from production to reform, in supporting the development of rural economy in China has made an important contribution and gradually formed a rural financial system. The composition of existing formal and informal financial institution in China are analyzed in detail. However, in recent years, the development of rural finance is facing serious challenges. According to this point, this paper carefully analyze problems of the current rural finance.In particular, there is huge financial consumer demand in rural, but issuing productive microcredit of formal financial institutions inhibits the support to consumer credit in life. For a long time, China's rural economic and social operation is carried out by mutual financing. Given to economic ties between the rural family, Courtesy Demands Reciprocity and rituals such as weddings constitute the main content of consumer consumption. Most of the current rural credit products concentrate on the productive credit, and no offer for consumer credit, the gap of credit supply and demand is very obvious. Therefore, the fourth chapter investigates rural consumer credit market. At the basis of understanding mutual financing, consumer demand in China's rural areas was analyzed, then through the method of structural changes and contribution rate, the change of rural residents'consumption content and trend of futural consumption has been obtained.In order to explain that consumer credit plays an important role in the rural financial system and rural economy, this paper uses econometric methods in the fifth chapter, and comparativly analyzes production credit and consumer credit in driving GDP, through a series of tests and concluded:elasticity of GDP on rural household consumer expenditure is 1.124, far higher than 0.183 of the GDP on agriculture loans. In the Granger causality test, the consumer expenditure of rural residents affects on the role of GDP in the first lag, second and third are also obvious, but shows growth of GDP driving consumption. The role of agriculture loans and GDP. has not appeared after fifth lag. These results are sufficient to show consumer credit is better than production credit.In addition, the establishment of farmer credit rating system is the guarantee of controlling credit risk, determining the level of interest rates and improving the efficiency of supervision. Finally, building a good consumer credit environment as the starting point, it is proposed that policy commendations of building rural financial system, promoting effectiveness of rural financial service improving economic growth, really serving "Three Agriculture".The innovation of this paper are:Firstly, topic and perspective of research is innovative. Consumer credit in rural areas is a new power. Previous studies on the construction of rural financial system seldom research how to build rural financial system from the perspective of the rural consumer credit.Secondly, train of thought and methods of research is innovative. Now research on consumer credit is mainly about how to provide the necessary conditions of policy support and development. As to carry out what types of consumer credit in rural areas, it is relatively little. This paper suggests that combining consumption of the rural folk rituals such as weddings and funerals with the consumer credit in rural areas. This will not only meet the huge consumer demand of farmers, but protect the traditional culture of China. As to the feasibility of consumer credit in rural areas, by econometric methods, including the flexibility of the GDP, lags and co-integration tests, this paper gives evidence to prove the superiority of consumer credit. Not only the theoretical basis and empirical research has also been innovative.