Research On The Impact Of Social Captial On Farmer's Loan Default Risk

In February 2015,the government proposed in the "Several Opinions on Increasing Reform and Innovation to Accelerate Agricultural Modernization" to vigorously develop rural inclusive finance;in December of the same year,the "Promoting Inclusive Financial Development Plan" issued by the State Council(2016-2020)also clearly pointed out that small and micro enterprises,farmers,urban low-income people,poor people and disabled people,the elderly and other special groups are the key service targets of China's inclusive finance.At present,inclusive finance has become an important strategic choice to promote China's rural financial development,and is of great significance to China's financial practice.As an important animal husbandry production area and agricultural product supply place in Inner Mongolia,Inner Mongolia has extensive demand for financial services.Especially under the guidance of China's family ranching policy,farmers in Inner Mongolia have an urgent need to rely on financial means to raise agricultural production funds.However,the unique social environment and economic development in Inner Mongolia has caused the problem of higher default probability of farmers' loans,which has formed credit constraints for poor farmers.Social capital not only has an impact on the availability of credit for farmers,but also has attracted more and more attention from scholars.Therefore,the research in this paper focuses on the impact of social capital on the default of farmers' loans.This paper sorts out the literature on social capital affecting farmers' credit default behavior,and forms the theoretical basis of the research.By collecting relevant data of rural household loans in Inner Mongolia,it summarizes and organizes,shows the current situation of the default of rural household loans in Inner Mongolia,and explores the basis of this.The reasons for the default of farmer loans were analyzed.The mechanism of social capital in the default of farmers' loans was analyzed by using game theory.Finally,using the survey data of Inner Mongolia,the probit model was used to analyze the impact of different types of social capital on the default of farmers' loans.Through the above research,the following conclusions are drawn: social capital can improve the ability of farmers to repay loans and the willingness to repay loans,which helps to reduce the default of farmers' loans;at the same time,different types of social capital have different effects on farmers' loan defaults.Social capital has an inhibitory effect on loan defaults,while informal social capital has an incentive effect on loan defaults.The research in this paper helps to optimize rural credit products,reduce the probability of farmers' loan default,reduce the credit constraints of farmers,and promote the healthy development of rural finance.It is also beneficial to the practice of inclusive finance.