Research On The Rural Households' Borrowing Behaviors Based On The Perspective Of Transaction Costs

Since 2004,documents of the Central Government have focused on the Three Rural Issues,and the financial support on Three Rural Issues is placed in an important position.The first government document of 2016 is clearly put forward to deepen financial reform and innovation in rural areas.To deepen the reform of rural finance,and to promote the financial resources to continue to support "three rural Issues ",are the urgent need to build a well-off society in our country.As an important part of rural economic development,farmers are facing a direct impact on the transformation and upgrading of agriculture and improving the income of farmers.Due to the weakness and high risk of agricultural production and farmers' small-scale family business,these result in farmers' smaller-scale borrowing and lack of the collaterals.These characteristics are unavoidable to increase the lending risk of financial institutions,and thus the coming strict examination and approval procedures and processes increase the transaction costs of rural household borrowing.Therefore,based on the farmers' part,it is important to study how to reduce the transaction costs in the process of borrowing,to promote the convenient financing of farmers,to deepen the reform of rural financial system,and to improve the rural financial system,which are of great importance to promote the sustainable development of rural economy.Based on the above research background,this paper takes Fujian province as the research object,based on the transaction cost theory,the borrowing behavior theory and the rural financial development theory,from the perspective of transaction cost analysis of household borrowing behavior.Through the analysis of the form,the form and the operating mechanism of the formal and informal finance,the differences of the farmers in the formal finance and informal finance are compared.Based on the analysis of the characteristics of the farmers,agriculture and rural households,the mechanism of the transaction costs to the farmers' borrowing behavior is discussed.Based on the questionnaire survey of farmers in Fujian Province,the characteristics of the sample households in Fujian province and the differences of the credit behavior of the farmers were analyzed and described in general.Five aspects,such as human capital,physical capital,social capital,geographical position and the transaction cost of borrowing and lending are used to analyze the factors that influence the availability of farmer loans from two aspects of the Probit model.The influential factors of farmers' financial channel selection are compared with the general statistical method.Using Tobit(Censored)model to estimate the factors influencing the scale of farmer loan from six aspects:the household human capital,the practical assets,the geographical position,the social capital,the borrowing history and the transaction cost.On the basis of the above research,this study puts forward to improve the rural financial service by improving the human capital,the practical capital and social capital,and to strengthen the construction of rural financial market from the four aspects of the factors that affect the loan.This paper mainly forms the following conclusions:1.Through the comparison of farmers in the formal and informal financial lending transaction costs,we find that although farmers in the formal financial lending with a lower interest rate advantage,but due to the formal financial institutions lending procedures,service procedures,network settings and other constraints,which still lead to the higher the cost of information collection,negotiation and decision-making costs,transportation and time costs,etc..The informal finance except the free-interest loans for the purpose of mutual-aid,lending rates are generally higher than the normal rate of formal financial loans.However,due to the simple informal financial procedures,flexible mortgage guarantees,basically there are no other transaction costs.2.The characteristics of farmers,agriculture and rural households' borrowing and lending,the farmers will inevitably face higher transaction costs in the course of their borrowing.Transaction frequency,asset specificity and uncertainty together constitute the main causes of the transaction costs.More human and physical assets of the farmers to form a specialized production mode,which will inevitably leads to higher borrowing and transaction frequency and asset specificity;geographic location will also affect the transaction frequency of household borrowing.And the uncertainty of market conditions and natural factors including the agricultural market also indirectly increases the transaction costs of borrowing and lending.In the three aspects of the comprehensive role,for reducing the cost of the transaction,the farmers have to choose the most convenient way the lowest transaction costs to borrow money.3.The sample analysis shows that the farmers in Fujian province are mainly male,aged mainly between 36-60 years old,the family population is generally from 3 to 5,most of whom just have had the primary school education.The proportion of farmers engaged in traditional farming is gradually declining,and the proportion of farmers engaged in non-agricultural production is increasing.Household income of farmers in Fujian province is generally high,the source of income is diversified,and the proportion of migrant workers and wage income in the proportion of household income increases gradually.Relatively low proportion of farmers in Fujian province in rural capital mutual cooperatives,agricultural cooperatives and UNPROFOR group and organization can be seen in Fujian province,the farmer cooperative economy organization development level,and the level of cooperation is seriously lagging behind the development of the rural economy.Rural financial infrastructure construction in Fujian province is relatively backward,which has become a big bottleneck of rural financial services.The annual interest rates of bank loans are mostly lower than 10%.The average time to get the loan is to go to the bank 2 to 3 times,the time spent in each trip is less than 2 hours,and the normal financial institution in Fujian province is relatively healthy.Farmers in the formal financial institutions are not too high frequency of the loan,and the majority of which can only get a loan once.4.The age of farmers,family and industry types of human capital on the availability of household loans have a significant reverse effect.The younger and healthier and the more productive and creative the farmers are,the easier access to obtain loans they get.The household and business type of the household is easier to obtain bank loan.This is related to a large number of rural households in Fujian province to implement a large number of Financial Tilt policies.Farmers' education level,household population,whether village cadres,whether there is a mortgage or a guarantor,farmers have livestock value,interest rates,from the application to get the number of loan negotiations and other variables,the availability of household loans have a significant positive impact.This is because of the higher education level of farmers with a strong wealth creative ability and willingness to invest,and they have a higher probability of obtaining loans.The more family members and the more the labor force the families have,the more ability to create productive value they have,the more confidence the financial institutions have to improve the loan.Village cadres and rural areas with a certain job get loans more easily;the higher the value of the physical assets of households,the financial institutions to prove their ability to repay the loan,the more easily they get loans.Farmers obtain formal financial institutions loans,but they need to spend a lot of transaction costs,such as higher interest costs,the need to negotiate with the bank.They may have to pay some of the hidden costs of gifts,too.The geographical position and the availability of the loans are not significantly affected by the farmers.5.The household population,age,education,physical condition of the household human capital in the household human capital has a certain influence on the choice of the farmers' credit channels.Family with 4 people,the age of 30,the higher education,the healthy body etc.,which are more likely to get regular financial institutions' loans.The value of productive fixed assets in the real assets of farmers has great influence on the choice of financial channels,and the value of the assets is higher than the proportion of farmers who choose the formal financial channels more than 10,000 Yuan.Whether farmers' social capital is by village cadres,loans are obtained through an intermediary and mortgage guarantor,whether they are members of cooperatives,whether UNPROFOR members of the group,these factors will also influence farmers' lending channels.The answer is that the probability of the farmers to choose the formal financial channels is higher.Relatives and friends in the financial sector,the proportion of farmers who work in the formal financial channels is slightly higher than the informal finance,there is a certain resource advantages.In addition,through data analysis,we also found that regular financial institutions in the 1-2 years,and the interest rate is low,most of which are in the range of the interest rate of 7%,beyond this level of lending,few farmers will turn to the formal financial institutions.From the application to the number of loan negotiations,the time they spent,the cost of transportation,the cost of gifts to the transaction costs,from the informal financial institutions loans with absolute cost advantage,which also increase the frequency of household loans.From the variable number of successful loans in the latest 3 years,we can see that the frequency of non-formal financial lending is significantly higher than the formal finance,which also confirms the above conclusions.6.From the sample data,Fujian province,there are more than half of the households who demand borrowing.Fujian province,the size of the loan is generally not high,the proportion of the loan of 50,000 Yuan accounts for nearly 70%.The use of the funds of the household loan has gradually shifted from the living type to the production and investment type.From the empirical analysis,the degree of personal education,asset value,and the distances from financial institutions,whether there is collateral,loan period,interest rates,loan time and the number of loans are all positive impact on the size of the loans.This shows that the more education,the more fixed assets,the closer to the financial institutions,and the longer duration of the loan,the larger size of the loan funds secured by the farmers.The interest costs(interest rates),time(the time spent on the loan)and the frequency of the loan(the number of times of the loan),the larger size of the loan could be.And the size of the livestock has a negative impact on the loan scale;the reason for this may be there are few households who are engaged in professional livestock breeding;besides their value is too low.Farmers are more likely to choose the formal financial institutions recognized collateral(such as large physical assets)to obtain a larger scale loan.The loan is oriented to the productive uses,which is helpful to get the higher-scale loan.7.To improve the human capital and asset of rural households,we can enhance farmers'financial awareness,improve the rural living security system and strengthen agricultural projects,etc.To improve the geographical location,we can better arrange the geographical location of rural finance and vigorously promote the use of rural financial network.To improve the social capital,we can make full use of the rural cooperatives and strengthen the construction of rural credit system and the innovative mortgage security mode.To reduce the transaction costs of farmers'borrowing,we can establish the agricultural insurance and reinsurance system,actively cultivate new rural financial institutions,reform financial products and services in rural areas,and implement differentiated interest rates,etc.Through reducing the transaction costs of farmers'borrowing,improving the financial institutions to serve the "Three Rural Issues" and optimizing the financing environment of farmers,we can ultimately establish an inclusive and sustainably-developmental rural financial system.