A Study On The Influence Of Financial Literacy On Farmers’ Borrowing Behavior

In the process of China’s sustained and rapid economic development,the biggest existing problems are the unbalanced development between urban and rural areas and regions,the increasing gap between urban and rural development,and the lack of foundation and momentum for rural development.Rural finance,as an important part of the financial system,has a significant impact on the development of rural economy and society.How to deepen the reform and innovation of the rural financial system,the most critical link is to improve the ability of rural financial services,promote the flow of capital to rural areas.In this key link,as the largest and largest micro participant in the rural financial market--peasant households,meeting their borrowing and lending needs for funds is the primary problem in the reform of rural financial market system and the improvement of rural financial service system.But with the deepening of informationization and marketization,the financial impact on peasant household economic activity is increasingly important,finance and Internet,artificial intelligence and big data fusion of technology development,and constantly enrich and innovation of financial products and services,makes farmers face the complicated financial environment,this to the farmer’s financial ability put forward higher request.Therefore,farmers are objectively required to have a higher level of financial literacy and the ability to judge,make decisions and identify risks to cope with the new financial market environment,so as to build a sound rural financial service system on the basis of meeting the financial borrowing needs of farmers and promote the stable development of the economy and society in rural areas.As a new research direction and perspective,financial literacy has been paid more and more attention by scholars at home and abroad.As a key factor for farmers to participate in financial activities,financial literacy has an important impact on the stability of farmers,families and even the entire rural financial market.In particular,the borrowing behavior of rural households has always been an important part of rural finance research.Based on this,an accurate,reasonable and scientific analysis of the relationship between financial literacy and farmers’ borrowing behavior is of great significance for improving farmers’ financial literacy and risk awareness in rural areas of China,stimulating their borrowing demand and enhancing their enthusiasm to participate in formal lending.Based on carding domestic and foreign financial literacy scientific connotation,financial literacy measurement system and method,the influence factors of financial literacy,and the impact of financial literacy on household financial behavior,on the basis of related research to the rural financial development theory,theory of financial literacy and financial literacy influence on family financial behavior related theory as the instruction,using household financial investigation items of the guanzhong region micro data of 727 peasant households to build a relatively comprehensive evaluation index system of farmers financial literacy system,using the entropy weight method to determine the index weight and evaluation the guanzhong area farmers financial literacy,the integrated evaluationMultiple linear regression model was constructed and the least square method(OLS)was used to investigate the influencing factors of farmers’ financial literacy.Secondly,Probit and Tobit regression models were used to analyze the impact of financial literacy on farmers’ borrowing behaviors,focusing on the impact of financial literacy on farmers’ borrowing preferences of formal financial institutions and informal channels.The empirical results show that financial literacy has a significant positive impact on the borrowing behavior of farmers,which will significantly increase the possibility and amount of formal financial borrowing for farmers.In addition,the instrument-variable method(iv-probit and iv-tobit)was used to test the endogeneity of the empirical results,and the score simple summation method was used to re-measure the financial literacy level of farmers to test the robustness of the empirical results.Based on the relevant research conclusions,this paper puts forward policy Suggestions to improve farmers’ financial literacy and optimize their lending behaviors from the perspective of the government,rural financial institutions,regulatory agencies and farmers themselves,aiming to provide theoretical basis and decision-making reference for improving farmers’ financial literacy and optimizing lending policies in rural areas.