Improvement And Development Of Rural Financial Institutions To Support Rural Economic Growth

China is a large，developing country especially in terms of agriculture，with itsprominent national strategy focusing on “the development of rural economy， thetransformation of rural industry， the increasing income of peasants”. Therefore， amain issue with regard to how to efficiently develop financial institutions in ruralareas and how to boost the economy in countryside has been frequently discussed byboth domestic and international scholars in the long term. Yunnan province is situatedin the very southwest of China， and agriculture is the predominant industry within it.However， due to the special geographical location and environmental factors ofYunnan， which is a typical agricultural province within China， its rural economyhas been severely restricted. Under this context， the issue of agriculture seems to beoutstanding. Hence， with the aims of finding out the problems inside the process ofrural financial development， this dissertation selected rural areas of Yunnan as themain research field， and meanwhile， conducted empirical analysis betweenfinancial development and economic boost of Yunnan province in order to makesuggestions for rural finance regime and to contribute to the enhancement of Chineserural finance reform.This dissertation first rearranged and reviewed a mixed of relative documentwith respect to rural finance and economy theories published both domestically andinternationally. And then strived to discover proper research methods fordemonstrating this article. In addition， this essay conducted a brief introduction forboth the historical rural finance development and the current developmental conditionof Yunnan， and proceeded to further description in regard to the current condition ofrural economic development of Yunnan. Furthermore， this essay collected andprocessed relevant data of rural finance and economic development within Yunnanprovince during two decades from1991to2011， and then picked out certainindicators in relation to the scale of rural financial development， efficiency of rural financial development and relationship of rural economic development. After that，this essay successively implemented unit root test， co-integration test and GrangerCausality test with the purpose of empirically analyze the relationship between ruralfinance and economic development within Yunnan province， of deeply arguing theoutcome of empirical analysis， and of finding out factors restricting the financialdevelopment of rural areas of Yunnan. Lastly， this essay addressed deeper analysisfor those influential factors and accordingly raised up certain policies and suggestionsin order to complete and progress rural financial institutions to boost rural economy.The primary conclusion of this essay is: the situation of rural financialdevelopment is relatively delay in Yunnan， which impeded the economic growth ofcountryside. The causation of this circumstance is that the flaws within the financialdevelopment of Yunnan rural areas negatively affected the way how rural financeimpact villages. For the sake of more effectively supporting the economic growth，Yunnan province ought to reform thoroughly and perfect rural financial developmentin terms of scales， structures and efficiencies.