The Influence Of Social Network On Farmers’ Borrowing Behavior

Agriculture is the basic industry of China’s national economy and plays a very important role.However,due to the natural weakness of agriculture,insufficient economic benefits and poor ability to resist risks,the urban-rural dual economic structure is obvious,and the "three rural" problems are becoming increasingly prominent.In recent years,China’s rural economy has achieved rapid development,and the quality of life of farmers has also been qualitatively improved.With this,the demand of farmers for capital loans has increased.Compared with urban residents,it is difficult to meet the loan needs of farmers.This is because there is information asymmetry between farmers and formal credit institutions,and farmers lack effective collateral.At the same time,the operation orientation of formal credit institutions tends to maximize the interests,which makes it difficult for formal credit to meet the needs of farmers.Farmers are generally faced with the dilemma of credit constraints.China is a relational society with a strong local complex,which is more obvious in rural areas.Private lending based on social network relations such as kinship and geography is very active in the rural credit market.At the same time,the social network also acts on the formal financial market to a certain extent.This paper studies the impact of farmers’ social network on Farmers’ borrowing behavior through formal and informal channels.The research content of this paper mainly includes the following parts: firstly,it introduces the background and significance of this topic,and specifically summarizes the corresponding research content,structure,thinking methods and technical routes;Then,it summarizes the theories related to farmers’ lending,including rural financial system,farmers’ lending behavior and social network theory;Then,the descriptive statistical analysis of cfps18 sample data,including the basic situation of sample farmers,their social capital characteristics and loan characteristics;Finally,in the empirical research stage,the individual characteristic variables of farmers and the relevant variables of social network are regressed step by step,and then they are brought into the two-stage hurdle model,which is combined with the two models to comprehensively analyze the lending behavior of farmers.The empirical results show that social network has a significant impact on Farmers’ lending behavior,and there is a significant positive correlation between formal lending and informal lending.With the expansion of social network,farmers can not only get more funds from private loans,but also get more funds from formal financial institutions.At the same time,the information of individual characteristics of farmers is included in the data of farmers.The positive loan scale of farmers is negatively correlated with age,and the spouse and family size have a significant positive correlation with the loan scale of farmers.The results of this study have the following implications for alleviating the problem of difficult and expensive financing for farmers: first,pay attention to the role of social capital in farmers’ lending behavior,comply with the law of the role of farmers’ social network,and give full play to the role of social network in farmers’ lending behavior.Secondly,informal lending still accounts for a large share in the rural financial market.Social networks can improve the availability of informal lending,improve the efficiency of financial behavior implementation,and make full use of this mechanism can reduce the bottleneck of rural finance.At the same time,because the formal lending behavior will be the development trend in the rural financial market,applying the social network mechanism to the rural formal financial market and designing more financial products that meet the characteristics of farmers’ social network can improve the allocation efficiency of rural financial resources.