The Institutional Analysis On Relationship Of Ningbo Rural Finance And Economy

Based on the reality of increasingly important about “agriculture, farmer and rural area”issues, the importance of rural economy to Ningbo economic development and the financialsupport to rural economy.This paper, firstly, make a systematic review and comment on therelationship theory and the new institutional economics theory between rural finance and ruraleconomic.And then, the paper analyzes the institutional change and innovativemechanism,characteristics and influencing factors of rural finance and economy, according tothis, built the analysis framework of the object. Finally, with the retrospect of institutional changeand innovative history about Ningbo rural finance and economy, the paper further made anempirical analysis of the relevant data of Ningbo rural finance and rural economy during1978to2009by the use of co-integration test, granger-causality test and differential decompositionmethod. Meantime, made an explanation of the empirical results combined with the specificconditions of Ningbo and propose several specific policy recommendations.The main conclusions of the paper are as follows:（1）The empirical results show that, the size of rural finance and the income of farmerappears a significant positive correlation, while shows no long-run equilibrium relationship withthe rural and agriculture per capita GDP. The farmers’ and rural savings deposit did not become agranger cause of GDP growth.（2）The excellent traditional culture, ethical culture and the innovation culture of Ningbopromote a positive development of rural finance and the per capita income. In addition, the formalsystem of Ningbo also provides a strong guarantee for it. The government action conflicts of therural finance supply system are an important reason of un-interact develop about rural savings,rural deposit and rural economy.（3）To promote long-term interactive development of rural finance and economyshould be based on the creation and improvement of the institutional environment,further strengthen of integrity culture, a reasonable guide the development andinnovation of informal finance, and the regulation on the government function.