The Impact Of Farmland Property Rights System Reform On Rural Credit Market

Like most developing countries,low efficiency of China's rural credit market,high degree of rural households' credit constraints.Reasons are information asymmetry and high transaction costs.In addition,it may also be closely related to Chinese farmers general lack of effective collateral.Cirrent farmer-owned land,houses and other assets have not become legally valid collateral.Since 2008,the central government continues to promote the reform of farmland property rights system,and gradually gives mortgage on farmland contracting management right,on the basis of farmland titling,registration and certification.Some local governments combined with local conditions,to carry out various forms of farmland mortgage.However,farmland mortgage has not generally recognized by existing laws.So,in this context,what is the impact of farmland property rights system reform on rural credit market?In particular,what is the impact on financial institutions'eredit supply and farmers,credit demand?What is the mechanism?For the possible impact,what policy adjustments should be made by local governments in the future?To answer these questions,this thesis constructs a theoretical framework to analyze the impact of farmland property right reform on rural credit market,and to clarify the mechanism of impact.Through conducting field surveys in the farmland property rights system reform pilots,Wuhan and Zaozhuang,and non-reform pilot,Nanjing,collecting relevant information and 707 sample households data,this thesis studies the impact of farmland property rights system reform on rural credit market.The thesis is made up of six parts.The first part presents the problems.It introduces the research background,problems and significance,defines some related concepts,introduces objectives,eontents and methods of this research,and describes possible innovations and shortcomings.The second part is the literature review.It reviews the relevant research at home and abroad,and gives a brief summary of current research.The third part introduces the analytical framework and survey design.Based on the property rights system of farmland at this stage,it classifies formal credit demand of farmers.Discussing the mechanism of farmland property rights system reform affecting rural credit market.In particular,it analyzes the effect of credit supply and the effect of credit demand.In addition,it presents hypotheses of this thesis.Finally,this part introduces the survey design and sample selection of this study.The fourth part analyzes farmland market and rural credit market in sample areas.This part introduces patterms,Progress and problems of farmland property rights system reform in pilot areas,analyzes the farmland mortgage supply behavior of financial institutions in sample areas,and describes basic family situation,farmland titling and circulation,lending practices and formal credit demand of sample rural households.The fifth part empirically studies the impact of farmland property rights reform on rural credit market.Firstly,analyzing the credit supply effect of farmland property rights system reform by using farmland mortgage supply data of financial institutions and loan data of sample households in pilot areas.Secondly,based on 707 sample households data,testing the impact of farmland property rights system reform on nominal credit demand and latent credit demand.In addition,studying the impact of farmland property rights system reform on the informal credit sector.The sixth part is conclusions and recommendations.This thesis finds that the credit supply effect of farmland property rights system reform appears,and shows the characteristic of scale preference.Farmland titling,farmland circulation and scale significantly increase the nominal credit demand of farmers.However,in the case of existing laws prohibiting farmland mortgage,financial institutions' lack of willingness to supply and their lending policy giving preference to scale business entities largely inhibit farmers from expressing their nominal credit demand.In addition,informal credit is a complement to farmland mortgage supply of formal credit sector.In the future,relevant laws and policies restricting farmland mortgage should be revised;fostering formal farmland circulation market and developing moderate scale management;establishing and perfecting guarantee and risk compensation mechanisms of farmland mortgage,and increasing the coverage of policy-oriented agricultural insurance;and using informal credit and other forms of financial innovation to ease credit constraints faced by small-scale farmers.