A Study On Regional Disparities And Influence Factors Of Financial Support To Agriculture In China

As an agricultural country, China lags the other country in the agriculturaldevelopment. Agricultural production is still belongs to the labor-intensive industries inChina, due to the limitation of production conditions. Compared with the developedcountries, the lower efficiency of agricultural production makes farmers small profit. Sofarmers can not increase input to renew the production facility with no money, andlower production efficiency is still there. The poverty can not be changed in this way.Some stuff must be done to recover the relationship between bad production conditionand rural poverty. Loans can be delivered to famers from government with the mediumof financial institution, with which farmers would update their production equipmentand get more efficiency that means richer to farmers. Obviously, financial support toagriculture in China is enormous significant and indispensable.China is such a vast area that tremendous regional differences must be seen innatural resource endowment, economic level, and social culture and so on. No doubt,financial support to agriculture in China is included. Only after learning the regionaldifferences and influence facts of financial support to agriculture in China is relevantpolicies introduced by government to alleviate the regional differences and promotebalanced development among regions.On the basis of rural financial theory and financial development theory, apreliminary analysis of the present situation of financial support to agriculture in Chinais showed. Next this paper measures regional disparity of financial support toagriculture by Thiel index, GINI coefficient, C.V coefficient and σ coefficient, in28provinces of China in1978-2010. Then regional disparity in eastern areas, central areas,western areas, among the areas and in the areas is figured out by decomposition of theThiel index. Last, this paper makes empirical regression by using provincial panel datafrom2006-2010year, the result shows that the level of fiscal support to agriculture,financial density, financial scale, the agricultural structure and the level of urbanizationis the key factors to influence the regional disparities of financial support to agriculture.Finally, some suggestion for narrowing the regional disparities is provided.