| Rural credit cooperatives are the main productive force in rural finance. The reform and development of rural credit cooperatives are keys to improving rural financial services, and are also beneficial to agriculture, rural areas and farmers. The reform and development of rural credit cooperatives have attracted attention from all sides. The State Council issued the"Rural credit cooperatives deepen reform pilot project"in 2003, which defines the basic requirements of rural credit cooperatives reforming as"clarify property rights, reinforce the binding mechanism, and strengthen the service function". Its goal is to provide good service, and meanwhile achieve the sustainable development as a financial enterprise. Through concerted efforts of all parties, the reform and development of rural credit cooperatives have achieved some results: there has been significant improvement in asset quality and obvious increase in profitability; agriculture inputs have apparently increased; property rights system have started; a preliminary framework for corporate governance has been established; and exploration in the fields of clarifying property rights and improving corporate governance structure has been made.However, the reform and development of rural credit cooperatives have not been resolved ultimately. The quality of service is still not high. The self-restraint mechanism is still imperfect. Most outcome of the reform relies on the governmental support, and the management and Business efficiency still need improvement. It is of necessity to scientifically analyse the efficiency of rural credit cooperatives after reforming.Up till today, few scholars have ever evaluated the efficiency of rural credit cooperatives and their conclusions have been different. Mainly two factors account for it: first, it is difficult to obtain the panel data needed to study the differences before and after the changes, and rural credit cooperatives are the most sensitive in China's financial system; second, it is difficult to establish the standard evaluation criteria for the Business performance of rural credit cooperatives.This article will investigate in the efficiency and influential factors of the reform of rural credit cooperatives to establish an efficiency research model, so as to evaluate the reforming efficiency and identify its main influential factors. On the one hand, through the comparison of rural credit cooperatives and other financial institutions, we find the suitable evaluation indicators, and then build the evaluation model and its impact factor model. The purpose is to make up the deficiencies in current theoretical research in the efficiency of rural credit cooperatives. On the other hand, the conclusion of the study of the efficiency of regression analysis to identify the impact of differences in the development of rural credit cooperatives in all the key factors, to the relatively slow progress of the reform areas to improve measures to help achieve their objectives. On the other hand, through the regression analysis of efficiency conclusion, we identify the key factors, and then we give some improving recommendations to the relatively lag-behind areas, which is beneficial to achieving goal.This paper has mainly used the enterprise performance appraisal theory and data envelopment analysis to test the hypotheses and problems needed to be resolved based on the research results of commercial banking efficiency. The paper has combined several methods: empirical research and theoretical analyses, micro-and macro-behavior combination, quantitative and qualitative analyses, theory and practice of combining research methods. In the theoretical model, the main methods are mathematical programming of management science and regression analysis of econometric. In the designing of overall framework, the paper has used computer programming and stochastic simulation methods.The paper is divided into seven parts, the main contents and structures are as follows:Chapter1 is introduction. This chapter mainly introduces the research background, meanings, problem definition, theoretical basis, ideas, methods, and the overall framework.Chapter 2 is the review of the development of rural credit cooperatives home and abroad.This chapter describes the development of rural credit cooperatives both abroad and in Taiwan Province of China, in order to provide a more general study space for the following-up research. At the same time, the domestic history of rural credit cooperatives, their reform, development trend and the main problems are analyzed and described, in order to provide historical background and current basis for the analysis of the efficiency of rural credit cooperatives.Chapter 3 is the theoretical basis of the research.This chapter has reviewed the enterprise performance evaluation theories and the development process. It also points out the important contents and concerns of different evaluation methods, which indicates that the theory and evaluation system is a dynamic process. This chapter has also summarized the results of financial institutions performance and reviewed several views of rural credit cooperatives performance studies. Therefore, this chapter defines the research scope of performance study for rural credit cooperatives, which provides the theoretical foundation for further study.Chapter 4 is the research design.This chapter compares the parametric and non-parametric methods of forefront efficiency analysis. On the basis of current commercial banking efficiency researches, this chapter has built the priduction efficiency and cost-effective of data envelopment analyzing model of rural credit cooperatives. Also, this chapter has built the Malmquist TFP index model of rural credit cooperatives, while using two-stage analysis and a bootstrap method to set up the model of influential factors for the reforming efficiency of rural credit cooperatives.According to the characteristics of rural credit cooperatives, we have selected the input indicators, output indicators and price indicators of input elements. This chapter also gives a detailed description of sample selection and data collection.Chapter 5 is the empirical research of production efficiency, cost efficiency and total factor productivity on rural credit cooperatives.In this chapter, we have used data envelopment analysis methods and DEA Solver Software. First, we do the empirical study on 51 rural credit cooperatives in Sichuan in their Priduction efficiency, pure Priduction efficiency and the corresponding input redundancy, lack of empirical analysis of the output from year 2001 to 2007. Then we do the empirical study on their cost-effective and efficient allocation of resources from 2001 to 2007. Finally, we do the empirical study on their level of total factor productivity and changes in the composition from 2001 to 2007. Important findings are as follows:Priduction efficiency is increasing year by year after reform but tends to decrease in 2007. The pure Priduction efficiency is consistently low and is even lower after reform while scale efficiency maintains in a high level. The non-performing loan has a major influence to Priduction efficiency. There generally exists serious redundancy of inputs and shortage of outputs in rural credit cooperatives before and after the reform.Cost efficiency remains low and has the tendency to be lower in future. This is mainly because of the low average allocation efficiency, which is further resulted from the discrepancy between the ever-accelerated pace of wage level plus fixed assets depreciation and the failure of rational allocation for personnel, fixed assets and capitals.In total factor productivity fields, the TFP is increasing all the time. However, there aptears a lower level of growth rate after reform than before. technology progress is an important driver important the growth. Meanwhile, imbalance of the development between the cooperatives aggravates the situation.Chapter 6 is the empirical research of influencing factors of rural credit cooperatives efficiency.The chapter applies Tobit regression model and the bootstrap method to study influencing factors of the purely priduction efficiency, allocation efficiency and scale efficiency of rural credit cooperatives in Sichuan Province. Panel data of 51 rural credit cooperatives from 2001 to 2007 is used in this chapter. Important results are as follows:For influencing factors of purely priduction efficiency, loan-to-deposit ratio, the ratio of agriculture loans and average total assets exert positive impact to pure priduction efficiency. However, proportion of post-secondary and higher education staff, non-performing loan ratio, per capita GDP of the local, the rate of Business costs, the proportion of the assets of loans and investment shares influence purely priduction efficiency negatively.For influencing factors of allocation efficiency, loan-to-deposit ratio and the ability of business innovation is a positive impact; proportion of post-secondary and higher education staff, non-performing loan ratio, the proportion of local primary industries, the proportion of assets and investment shares have negative impacts to allocation efficiency .For influencing factors of scale efficiency, loan-to-deposit ratio, per capita GDP of the local, the ratio of investment shares and legal person shares are positive influence to the scale efficiency. Nevertheless, the average total assets are a negative influence.Chapter 7 is research conclusion and future prospect. Combining the previous chapters, this chapter draws conclusion for the research and points out directions for further study.Chapter 8 offers suggestions to improve the efficiency of rural credit cooperatives. According to the earlier findings of the paper, this chapter gives detailed suggestions to improve the efficiency of rural credit cooperatives in reforming policy design and internal management of rural credit cooperatives.The main research sides and innovation of this study was mainly in the following three aspects:First, this article combined the total factor productivity to the framework of rural credit cooperatives efficiency studies, and did a deeper research on the dynamic changes in structure and changing sources of total factor productivity. It has enriched the theoretical content in the study of efficiency of rural credit cooperatives and the follow-up empirical research has a certain reference value.Secondly, the way of empirical research in this article, started with the overall changing trends of rural credit cooperatives efficiency changes of a certain period, and then analyzed efficiency changes during the phases before and after the reform. The efficiency changes before and after the reform of rural credit cooperatives has been sorted out to discover the downward trend in value. This contributed to start a more extensive and in-depth study and discussion on the academic efficiency of the reform of rural credit cooperatives.Third, this paper, using regression analysis, comprehensively and systematically compared the impact of rural credit cooperatives on the efficiency, identified the genuine factors that lead to the efficiency changes. It expanded the understandings of the impact of influencing factors. Under the framework, we find the conclusion: the proportion of agriculture and rural credit cooperatives loans has a positive correlation between the efficiency of rural credit cooperatives. It provides a new idea to solve the dilemma: commercialization and adherence to farmer support.Some of the conclusions in this article, such as "the knowledge level of staff and working efficiency was a negative correlation", "the proportion of investment in shares, the proportion of corporate shares, together with pure priduction efficiency, and allocation efficiency were negatively correlated or non-correlation" and so on, all went adverse to the original purposes of the government policies. However, deepened studies find it is in the implementation of the reform process that has error, giving rise to the strange results. These conclusions indicate that the policy designers must consider the policy-takers for whom the reform is a balance game, to carry out policies more in line with the actual results.There are some limitations in this paper:First, the price of the receivable loans X3, due to the several changes of the central banks'benchmark interest between 2001 and 2007; I did not separate the influence of interest float on W3, subject to the restrictions on research techniques. More rigorous approach is to process and adjust these data to make the result more scientific-looking.Secondly, the study found that after the reform of rural credit cooperatives, the efficiency of growth was lower than the level before, especially in 2007. Research on the reasons for the decline is not enough yet, and it requires practical details to further discuss.Thirdly, the correlations of variables have not been completely eliminated, so the calculations may thus be influenced. We can further improve the impact model of efficiency variations in the future.
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