Research On The Effect Mechanism Of Lean To Agricultural Income

Our country is a large agricultural country, stable development of agriculture have great significance for the entire country. Since 1978, the government has intensified support for agricultural production, agricultural production has also achieved great development. However, for the individual, family Agricultural production enthusiasm is not very strong, a lot of labors flowfrom the countryside into the cities, even a "fallow" phenomenon. On the one hand, the cause of this problem are the long cycle in agricultural production, low rate of return and other characteristics of its own. On the other hand, it comes from the agricultural funds. The use of modern capital goods increases the cost of production which makes the farmers relative shortage of funds, the shortage of agricultural funds makes the shortage of the agricultural funding, ultimately, it leads to a reduction of agricultural income, which creates a vicious cycle, making the farmers’ enthusiasm for production is weak, resulting in a "fallow" Phenomenon.Agricultural funds not only have important influence on the families’ agricultural production, but also on the development of the whole country agriculture. As an important source of funds, loan can not only provide the necessary funds for farmers living consumption, but also provide farmers the necessary funds to maintain or expand production. The current development of China’s rural finance is not perfect, channels of loan funds received are not unique, but also a variety of purposes. In addition to part of the funds obtained, the more important issue is the use of the funds. After the farmers can get loans, it is necessary to determine whether the funds have oriented introduction of rural areas into agricultural, rational allocation of resources, increase farmers’ income, improve farmers’ lives. Therefore, it is necessary to study the problem of the rate of return of the funds, or the production capacity of the funds.This paper study the effect mechanism on agricultural income of farmers loan based on CFPS. We firstly study the factors affecting household borrowing, further analysis the impact of borrowing on agricultural income based on last question. Then, when research effects on farm income, we add the impact of borrowing on the agricultural inputs. In analyzing the impact of production inputs farmers borrowing, taking the endogeneity of household characteristics into account as well as the differences in the model, we use a propensity score matching methods of treatment effect analysis, so more accurately been brought into production lending "pure effect. " Although the above method takes the differences and endogenous samples were matched into account, but finally obtained for treatment effect for all samples, and did not take into account the treatment effect between the sample differences, therefore, we will sample are divided into different levels in accordance with different Indicators, so that to analyze the problem of heterogeneity of treatment effect.Based on these studies, we will use the results into the estimated function of household income, the inputs to agriculture is divided into two parts:one is the farmers’inputs when not borrowing, known as willingness investment; the other one is the inputs which were prompted by the borrowing, called promote investment. The results showed that:Farmers willingness investment and promote investment had a positive impact on the agricultural income, and the promotion of investment income is greater than the willingness investment, effectiveness of formal borrowing is greater than the utility of informal borrowing.This paper discusses the problem of borrowing in the study on the basis of many scholars’ studies, and most previous scholars do not distinguish between the use of borrowing, directly study the role of loan on the farmers’ household income, qualitative analysis of its effects on farmers’ income, with few puts eyes on the middle part of the added agricultural production, quantitative analysis of the role of productive lending. In this article, we will separate the loan which was used to produce out from the overall loans, and thus a more targeted analysis of the various parts of the production inputs for the role of farmers income, this analysis is to analyze roles of the various parts of investment played in farmers’ income, so that agricultural production inputs will be more directional and targeted.