Research On The Impact Of Rural Financial Development To Farmers' Income Growth:Evidence From Henan Province

The problem of farmers' income is an important issue facing the poverty alleviation in rural areas in Henan Province,and it is also a core issue that needs to be resolved in the country's "three rural" policy.In recent years,with the country's tilting agricultural policies,rural areas in Henan Province have achieved remarkable economic development and farmers' income has continued to grow.However,due to the inherent backward production methods,ideas and infrastructure construction in rural areas,the income of farmers is far lower than that of towns and cities.Resident income,as of the end of 2016,the income gap between urban and rural residents in Henan Province is around 15,000 yuan.Rural finance serves as the basis and core of the rural economic system,and farmers' income is a direct reflection of rural economic development.This shows that rural financial development is an important factor influencing farmers' income.The current financial development in rural areas of Henan Province is not perfect.There are problems such as the shrinking financial market,the absence of a financial system,and the non-standard financial development.As a result,most loans in rural areas rely on informal financial institutions and non-governmental financial organizations.As we all know,Henan Province is an important agricultural province in China,with a large population of peasants,relatively backward rural economic development,and many low-income groups.There are many problems in the development of the rural financial system.This article describes the development of rural finance in the province and the increase in peasant income.The Impact Study Conference has important guiding significance for the development of the financial system in the rural areas of the province and the increase of farmers' income.Based on this,the thesis begins with the research and analysis of the related theories of farmers' income and the financial development in rural areas,and then uses the survey data of rural finance and farmers' income in Henan Province from 1989 to 2016 to comprehensively discuss and analyse the development status.On this basis,three indicators of rural financial development and indicators of rural investment and rural labor employment structure are selected to study the rural financial influences development in Henan Province on the growth of farmers' income.This paper conducts an empirical analysis of time series and draws the following conclusions:The rural financial development in Henan Province has a positive effect on the increase of farmers' income,and there is a co-integration relationship between the two.The scale and structure of financial development in rural areas have a positive impact on the improvement of farmers' income.The contribution rate of rural financial scale is the most significant,reaching 60.37%,while the contribution of rural financial development structure is not significant,only 0.385%;the effect of rural financial development efficiency on farmers' income increase is negative,and the impact is not significant at only6.64%;among the other variables selected in this paper,rural investment is negatively related to farmers' income,and rural labor is positively related to farmers' income.In addition,the scale and efficiency of rural financial development are the Granger causality of farmers' income;at the same time,the structure of rural financial development and the income of farmers do not have Granger cause.Through the analysis of impulse response function and the prediction of variance decomposition,with the long-term changes in time,increasing rural loans will increase farmers' income,and the failure of rural financial development will inhibit farmers' income.According to the conclusions,this article has targeted four countermeasures:First,optimize the structure of rural financial development,"tailoring" appropriate financial support and policy support for local township enterprises,expand the scale of rural loans,do a good job in rural areas;Second,improve the efficiency of rural financial development,innovate financial products,prevent the outflow of rural capital,ensure sufficient funds to serve the development and construction of rural areas;Third,guide rural investment to serve the economic construction of rural areas and avoid rural fixed assets,optimize the employment structure of rural labor force,strengthen the training of rural labor employment skills,and gradually improve the rural labor employment market;Fourth,encourage all forms of rural financial system development in all aspects,guide the development of non-governmental financial standardization,and play an important channel role of private finance.