An Empirical Study On The Relation Of Rural Finance And Rural Economy In GanSu Province

For the GanSu Province,The funds is the key of the development of rural economy. However, on the one hand,financial power in the GanSu Province is limited. This kind of devotion strength is obviously not enough for strengthen the agriculture foundation position. The Gansu village residents's pure income is low in the average level of the whole country, save ability is very weak. On the other hand,the GanSu Provine inherit the mode of economic growth in planned economy period in a large extent, causing the waste of resources. Therefore, to research the influence of rural finance on rural economy development and to explicit the mechanism how the finance influence the rural economy development is very important.In the different developing stage of economy development, interaction relation exist many possibility, the representation of the relation is "demand follow"and "supply ahead" causality model. This paper test the relation of the causality to provide basis at which the rural finance develop.First,this paper analysis finance development theories,economy development theories, to provide theory foundation for the whole paper. Secondly describe the condition of Gansu rural finance development and economy, review their histories progress. We carry empirical study to analyse the relation of rural finance development and rural economy. Finally ,This paper use Cointegration and Granger Causality theory analysis rural finance and economy development. And result show GanSu rural finance and economy development have certain relation, but the influence of each is very weak.On the entry-level stage of economy,we must supply finance service and finance organ, the government should respect the finance demand of rural economic individual and exert influence. Finally this paper put forward measures to establish finance system.