Does The Development Of The New Agricultural Organization Can Relieve The Rural Financial Restrain?

On one hand, the major part of agricultural production is rural household individual operation featuring "small-sized, isolation, scattering". On the other, agriculture is characterized by "natural character" and" poor resilience against risks" given its dependence on natural condition and season cycles. Agricultural financial demands deprived from agriculture are featured as follows:high cost of effective information acquisition and supervision,low returns, high risks, loaners'more possible opportunism and less collateral.Such credit demands of prohibitive systemic risks and information creation and high supervision cost fail to match financial system with cooperative credit society and agriculture bank. Thus, adverse selection exists among commercial financial provider, such as banks, in the condition of "information asymmetry". Even private loading enjoying soft information still can't effectively fill the financing gap due to its disadvantage. In this case, the demand-supply mismatch acts as the root cause of agricultural financial restraint.New-type operation subject includes cooperative credit societies, mutual financial organizations, intermediary agent and the group involved in concentration production in long-term cooperation with large sized enterprise. It dwarfs household agriculture as it can achieve economy of scale, present land rational use, enhancing productivity by making agriculture tend to be more mechanical, information-oriented, professional and technical. Furthermore, it can increase production material purchase, e.g. Chemical fertilizer and seeds, and expand market share of agricultural products. This paper analyzes new production subject growth capable of positively changing rural financial need features to alleviate agricultural. Financial restraint by creating higher agricultural capital returns, lower information cost and less saving outflow.The paper uses variable coefficient to indirectly measure development level of new agricultural industrialization group by discussing middle-and-large sized mechanical ownership, cooperative organization, quantity of agronomy graduates of bachelor degree, farm area of agriculture-related state-owned enterprise, township enterprise revenue and mechanical farm area. The paper conducts regression analysis for it and agriculture credit aggregate, agriculture capital return rate, agricultural saving outflow and rejection ratio, identifying the significant and positive influence of industrialization organization for rural credit aggregate and capital returns, along with negative effect on savings. In combination of theoretical and empirical analysis, we find that agricultural industrialization organization is.able.to alleviate agricultural financial restraint by increasing rural capital returns, lowering information costs and diminishing saving outflow.This paper has two main innovations. First, the research bases on the demand side to explain the rural financial restraint problem. And it concludes that the un-matching of supply and demand of rural finance directly lead the situation. That is to say, the main measure can radically solve the restraint is try to study the agriculture attempt to study whether can through the development of industrialization of new business entities, improve the "small, zero, closed, scattered" small family oriented production organization to change the "effective information gathering cost, supervision cost is high, the low rate of return, risk, borrowers with opportunistic behavior trend higher, can the rural financial demand characteristics of collateral less" to adapt to profit for the purpose of mainstream commercial financial system, thereby alleviating rural financial constraints. Second, based on the theory of the analysis combined with empirical analysis method, research on the development of the main body of rural industrial operation ease three channels of rural financial constraints to improve agricultural capital returns and reduce the cost of information to reduce the outflow of rural savings. Third, draw lessons from the variation coefficient method, considering the environment of rural industrialization main body development, features and conditions for the constructed index of industrial development, an indirect measure of the level of development of the rural industrialization main body, can effectively overcome the rural industry management organization statistics less samples, characteristics of time discontinuous and more comprehensive measure the degree of development.There are so many findings in the field of rural financial restrain either in our nation and abroad. However, no matter from the rural financial supply prospective or the side of the demand of the study, they all ignored the existence of rural financial foundation of rural life and agricultural production organization characters. Most of the studies are found rural financial constraint than the constraints of the medium and small-sized enterprises in the city is more serious, and also recognize that the information factor is the main reason, but few people from the perspective of rural mode of production and way of life to illustrate the problem. Although there are researches on the characteristics of the organization of production in rural areas and the significance for the development of rural economy, but are constrained to cooperatives such a special organization and theoretical deduction form, and there is no literature using the perspective of empirical methods and rural life and rural production organization characteristics research of rural financial constraint problem.This paper has three main innovations. First, the research bases on the demand side to explain the rural financial restraint problem. And it concludes that the un-matching of supply and demand of rural finance directly lead the situation. That is to say, the main measure can radically solve the restraint is try to study the agriculture organization. Attempting to study whether can through the development of industrialization of new business entities to change the "small, zero, closed, scattered" character of small family oriented productive organization to improve the effective information disadvantages which possesses high gathering expenditure, supervision cost and the low rate of return. We can certainly summarize the loaning businesses in rural market have high risk and the borrowers with opportunistic behavior trend to go beyond the contract. Otherwise by developing more industrial organizations can settle the dilemma of the rural financial demand characteristics of less collateral. Thus we can strengthen the traditional agriculture to fit the market-oriented and professional producing background. By this can make the agriculture finance demand agree business supply adapting to profit for the purpose of mainstream commercial financial system. Thereby, the industrial management can alleviate rural financial constraints. Second, based on the theory of the analysis combined with empirical analysis method, research on the development of the main aspects of rural industrial operation ease the financial restraint in three channels:to improve agricultural capital returns,to decrease the cost of information and to reduce the outflow of rural savings. Third, draw lessons from the variation coefficient method, considering the environment of rural industrialization main organization development. Because the difficulties to get the data of rural financial restrain, in this research the author attempt to construct a new indirect measure to describe the industrialization changing. We can effectively overcome the rural industry management organization statistics with less samples to show its trend and situation. This measure combines all the characteristics of this industrial development, which is a discontinuous and more comprehensive measure showing the degree of development.Study on the ideas and steps of this paper are as follows. The first step of development, through the theoretical analysis of the main production model is how to improve the characteristics of rural financial demand, which can improve agricultural capital returns, reduce information costs, and reduce rural savings outflow three channel to alleviate rural financial constraints. The second step is to design the theory of reasoning. The five empirical models, the first evidence that the rural industrialization organization development can indeed be increase the amount of rural credit, followed by an empirical model to prove that the increase of agricultural capital returns, reduce the cost of information, and reduce the outflow of rural savings can indeed increase the amount of rural credit, finally proved that development can improve the agricultural industrialization organization the rate of return of capital, reduce the cost of information, and reduce the outflow of rural savings. The third step, prove the results combined with the theoretical analysis and empirical study, summarize and put forward policy recommendations.