Zhejiang Province, Rural Financial Development Affects The Empirical Study Of Farmers' Income Growth

Since reform and open up policy, Zhejiang Province becomes one of activist and fastest area in economic growth by series of reform and preferential policies. In 2007, the net average peasant's income in Zhejiang Province was 8265RMB, 49 times of that in 1978; the average annual growth rate was 14.45%, far higher than that in the other areas. During the process of economic growth and civilization in Zhejiang Province, the issues concerning agriculture,countryside and peasant are still remain. In recent years, peasant's income grew slowly due to various reasons; one of the important reasons is rural finance development.It empirical analyzes the determining factor of the peasant's income, finding that loans have a positive effect on increasing the income of the peasants, but the performance of credit investment is not good than before, it is low efficiency in increasing the peasant's income, unable to play due role.Through the analysis of the rural finance development structure index, the rural saving index, the rural load index, and the rural finance development efficiency index in the model of regression and after unit root test, cointegration test, Granger causality test, we know that there is long-term cointegration relationship between Zhejiang rural financial development and income growth of peasants, and the growth of peasant's income has certain effects on rural deposit development, rural finance development has certain effects on growth of peasant's income.In order to establish a comparative rural financial market and improve rural finance efficiency, we should transform Rural Credit Cooperatives into commercial finance organization, develop village bank and encourage and support Agricultural Development Bank to expand rural policy monetary, cultivate other rural finance organization, and formulate policy and the law of the rural finance.