Study On The Threshold Effect Of Rural Financial Development Affecting Poverty Alleviation

Since the reform and opening up,China's rural poverty alleviation and development work has achieved remarkable achievements.The number of poor people has decreased rapidly at an annual rate of 18.96 million,and the income level of rural residents has continued to increase.However,while the poverty-stricken population has decreased substantially,the contradiction of "unbalanced and insufficient" has become increasingly prominent,the gap of incomes,medical care,education and social security between urban and rural residents has been widening,and the problem of relative poverty is still serious.The Chinese government has always regarded the elimination of rural poverty as the top priority of all work,and regards rural finance as an effective tool for poverty alleviation.It has successively issued a series of policy documents to promote the development and improvement of rural finance,and trying to increase support for poor areas through financial investment,in order to achieve accurate financial poverty alleviation.According to Schultz's human capital theory,the ability of individuals to effectively use production factors depends on the level of human capital.Therefore,the human capital of farmers will be the key factor affecting the effect of rural financial poverty reduction.In view of this,this paper reviews the rural financial development,financial deepening,poverty alleviation and human capital related theories,and explains the mechanism of rural financial development affecting poverty alleviation and the adjustment mechanism of human capital's impacting rural financial development on poverty alleviation.Then,by constructing a multi-dimensional poverty comprehensive evaluation index system including income,education and medical dimensions,the multi-dimensional poverty level of China from 2000 to 2016 is measured.Based on an in-depth analysis of the current situation of rural finance and poverty development in China,the paper directly analyzes the direct and indirect effects of rural financial development on poverty alleviation and the threshold effect of human capital through the use of fixed effect models and panel threshold models.The main conclusions of this paper are as follows:?1?Theoretical research shows that the transmission path of rural financial development to rural poverty alleviation is realized through direct and indirect mechanisms.From the perspective of direct mechanism,rural financial development enhances farmers'ability to resist risks and alleviates the financing constraints of farmers by providing financial services to farmers,thus contributing to the slowdown of poverty.From the perspective of indirect mechanism,rural financial development indirectly affects the slowdown of rural poverty mainly through economic growth effects and income distribution effects.In addition,the rural financial development has a threshold effect on the mechanism of rural poverty alleviation.The heterogeneity of human capital will affect the efficiency of farmers'use of financial products and services,thus affecting the poverty reduction effect of financial development.?2?Analysis of the status quo shows:With the continuous reform and improvement of China's rural financial system,the scale of rural financial deposits and loans continues to expand.However,the outflow of funds in the rural market is serious,the structure of capital supply is unbalanced,and rural financial development cannot effectively meet the needs of the market.At the same time,the multi-dimensional poverty level in China is also decreasing year by year,but it is mainly reflected in the improvement of income dimension,while the education dimension and medical dimension are developing slowly,and the multi-dimensional poverty level shows obvious regional differences.The eastern region has the lowest level of poverty,the second is the middle,and the highest is the west.?3?Empirical research shows that:First,rural financial development can significantly promote the multi-dimensional poverty alleviation in rural areas,and rural financial development can also alleviate poverty through economic growth effects,but the income distribution effect of rural financial development inhibits the slowdown of rural multidimensional poverty.The main reason is that rural finance has a "wealth threshold" and low-income groups are excluded by financial services,as a result,the income distribution gap between rural internal groups has been widened,leading to an increase in poverty.In addition,fiscal support for agriculture and rural fixed asset investment have also significantly promoted the slowdown of rural multi-dimensional poverty,but the advancement of rural science and technology has inhibited the slowdown of rural multidimensional poverty.Second,the impact of rural financial development on the multi-dimensional poverty alleviation in rural areas has a threshold effect,and there is only one threshold value of 4.53.There are significant differences in poverty reduction between rural financial development in different intervals.When the human capital level is within the first threshold?8?₄)?4.53),The impact of rural financial development on rural multidimensional poverty alleviation is not significant;when the human capital level is within the second threshold?8?₄)>4.53),rural financial development can significantly slow the multi-dimensional poverty phenomenon in rural areas,and the coefficient value is 0.69318.Therefore,only by continuously improving the level of rural financial development and promoting the accumulation of rural human capital,can we give full play to the poverty alleviation effect of rural financial development and achieve common prosperity.Based on the above research conclusions,this paper proposes the following suggestions:?1?Improve the inclusive financial service system and give full play to the poverty reduction effect of rural finance;?2?Promote rural human capital transformation and improve the efficiency of financial resources utilization;?3?Play the leading role of the government to build a good rural financial development environment...