Research On Risk Diffusion Mechanism In Rural Supply Chain Finance

Rural supply chain finances have been rapidly developing with e-business expanding into rural areas. There are all kinds of risk in rural supply chain finance because some uncertainties in rural e-business can make the structure of rural supply chain system unstable. Meanwhile, there are other risk factors such as the difference among different agents in the system and the systematic loss caused by one agent’s failure. Especially, when one agent in the rural supply chain suffered risk events and have been in loss, the risk will spread into its upstream and downstream partners through relying on the supply chain network, further generating a greater systemic risk, and this situation is being more and more prominent and far-reachingThere are quite a few literatures studying the risk diffusion issue in the traditional finance field. Most of them focus on traditional risk management, including the risk assessment, risk warning, risk control, risk response with a static perspective. However, the complexity and dynamics are the fundamental characteristics of risk diffusion, which is the result of the interaction of the agents’ complex behavior and structure evolution, which in turn, causing an evolution between the agents’ complex behavior and structure evolution. Rural Supply chain finance system is a socio-economic system with a complex network’s structural characteristics and behavior. This Paper takes rural financial system structure and behavior as a starting point, considering the complexity and dynamics of risk diffusion, researching on the risk diffusion mechanism of rural supply chain finance at both macroscopic and microscopic levels. First, the paper uses the complex network theory to research network structure and evolution model of rural supply chain finance system, analyzing how the network structure effects the risk diffusion, and how the impact on the robustness of network structure from the risk diffusion. Secondly, this paper uses the evolutionary game theory to research the agent behavior and its interaction model in the rural supply chain finance system, and analyzes the evolutionary game process between different agents, And further reveals how these game-behavior affects the risk diffusion. At last, the paper draws the conclusions and verifies the application of the case.This paper effectively combines the macroscopic and microscopic together, revealing the complexity and dynamics of risk diffusion, enriching the existing theoretical research in terms of research perspectives, methods and contents. Meanwhile, this paper applies the complex network theory and evolutionary game theory to financial risk diffusion field, which is also the application and expansion of the complex network theory and evolutionary game theory. In addition, this paper provides theoretical support for the government, enterprises, and farmers to carry out financial risk management in rural areas, having a certain practical guiding significance.