Transaction Costs, Organizational Performance And Rural Financial System In Reconstruction

China's overall economic strength has greatly upgrade in the past thirty years since reform and opening up, However, the development of rural economy has remained relatively stagnant, and become the main bottleneck which restrict the further development of China's national economy. Finance is the core of modern economy, and the same is true in the rural economy. Whether the development of modern agriculture, the transformation of traditional agriculture or the construction of new socialist countryside need a lot of funds, and need the powerful support of financial system. But in fact, there are serious problems on rural financial system. The innovative development of rural financial system has become the critical factor which restricts the further development of rural economy. The realization of the innovative development of rural financial system needs the understanding of financial organization's behavior. As the main factor which affects the behavior of financial organization, transaction cost provides a new perspective to study the decision behavior and operational performance of financial organization.The paper identified three kinds of transaction cost which has intensive relation on financial organizations in rural areas, that is information cost, operational cost and cost of risk management. Based on the detailed analysis of the factors which affect the three kinds of transaction cost, the paper constructs a transaction cost model to evaluate the performance of financial organizations in rural areas.The paper thinks that each changes of rural financial system would cause the change of the structure of transaction cost, which often inversely causes the next change of rural financial system, and the paper confirms the idea by the model.In the forth part of the paper, the author analyzes the present status of specific factors which affect the three kinds of transaction cost in rural areas, and then compares the performance of different kinds of financial organization on this basis.The author concludes that the construction of multilevel organization system should be the main director of rural financial system reform, and the development of small financial organizations in rural areas should be the breakthrough of rural financial reform.Based on above theoretical analysis, the paper puts forward policy proposals to how to construct multilevel financial organization system and develop small financial organizations in rural areas at last.