Positive Effects Of Shandong Yutai Rural Microfinance On Farmers' Income

It has already become the most important task of socialist construction that how to break the urban-rural dual structure, narrow the urban-rural residents' income gap, reduce the rural poor proportion, make the socialist modernization and agriculture modernization come true. Although our government has been continuing to make adjustments to make the rural financial market fit our socialist system, financial repression still exists in the rural financial market. It becomes the direct measure to solve the problem of farmers' income that how to release the vitality of the rural financial market, ease the financial repression situation, solve the farmers' financing methods. To some extent, it has become the first choice to solve the rural areas' supply and demand of funds that solving the finance needs of farmers, leading farmers to take the road of formal financial institutions., Microcredit is not only an important financial supply mode for farmers, but also become a strong back to make the "three rural" sustainable development come true. Whether the rural microfinance really can achieve farmers' income and achieve the desired effect in all areas or some ignored issues exist. We have to thorough further investigation of the farmers' family to settle these questions.Shandong Province is selected as the research content after taking the realities into consideration. Firstly, this article organizes domestic and foreign study dynamic from three angles, which are rural microfinance, rural finance and rural incomes, microcredit and income of the farmers. Secondly, rural microfinance related theories and concepts are discussed by agricultural credit subsidies, Hewlett-Packard of the financial system, the basics of rural micro-credit and income of farmers. Thirdly, the general analysis of Shandong rural credit and farmers' income is based on the above theories and contents. The study focuses on the analysis the situation of Shandong farmers' income; the analysis of mechanism of both and the reasons of credit and rural development exists. Finally, take Yutai as example area, the micro-data is obtained by introducing household survey of rural credit cooperatives and grassroots workers. Based on those collated and sorted data, the empirical analysis relationship between Shandong rural microfinance and farmers' income growth is analyzed by multiple linear regression models. The results have showed that Shandong rural microfinance has positive performance on farmers' household income and agricultural income. But rural microfinance has much more positive performance on non-agricultural income of farmers than that on agricultural income, and the non-agricultural trend will continue. Meanwhile, Shandong financial institutions appear diverse characteristics, the rural financial market competition becomes more and more fierce, and the development of the microfinance market entered a new era. Although Shandong farmers financing needs is changing and rural microfinance has the higher credit coverage, part of the farmers still have large demand for capital, and loans use transferred to non-agricultural spending.