Impacts Of Credit Exclusion On Farmer's Income In China

With the rapid development of China's financial market and the continuous improvement of the financial system,the financial industry has made significant achievements in its reform and development.However,the problem of insufficient rural economic development is still insufficient.The phenomenon of the slowdown in the growth of farmers' income and the widening income gap are particularly prominent.As the support for the development of rural economy,rural finance is an important means to solve the problem of “development imbalance”,promoting farmers' income and realizing a well-off society.However,in the face of the growing credit demand of farmers,China's financial institutions still regard urban areas with relatively developed economic levels as the focus of business development,while in economically underdeveloped rural areas,gradually withdraw the number of outlets or reduce the types of businesses,which makes it difficult for farmers to meet their loan needs,there are serious credit exclusions in rural areas.The “unreasonable” distribution of financial resources by financial institutions in rural areas not only has a certain impact on the production and life of farmers,but also seriously hinders the normal development of rural finance,which in turn further widens the income gap of farmers.Therefore,under the background of coordinating urban and rural development and building a harmonious society,it is necessary to study what extent does credit exclusion affects farmers' income,and what kind of mechanism affects farmers' income,which is urgently needed in rural areas.And this is also the purpose of this article.The main research contents of this article include: First,analyze the existing literature and related theories of credit exclusion,define the connotation of credit exclusion.Secondly,based on theoretical analysis,combined with relevant macro data to sort out the current situation of rural financial development in China,and use the data of farmers to analysis the current of rural credit exclusion.Thirdly,using quantile regression and the propensity score matching method to empirically analyze the impact of China's credit exclusion on farmers' income from the perspective of farmers' income structure and income level,and explore the mechanism of rural credit exclusion.Fourth,combine the empirical results with the current actual situation in China,and propose policy recommendations to optimize rural financial services,alleviate rural credit exclusion,and increase farmers' income.Through the use propensity score matching method and quantile regression,in this paper,the following conclusions:(1)The scale of financial development and the development efficiency of rural areas in China lag behind,and there is a serious phenomenon of credit exclusion.(2)Credit exclusion has different effects on the income of farmers at different income levels.Except for the low-income group,credit exclusion has a significant negative impact on the income of farmers at other income levels,and has the greatest impact on the income of farmers with high income levels.(3)Among the explanatory variables,the characteristics of principals,family resource endowments and social capital all have a significant impact on whether farmers are financially excluded by formal financial institutions.(4)Credit exclusion not only has a significant negative effect on the per capita net income of farmers,but also significantly negatively affects the per capita agricultural net income of farmers' households.(5)In the process of empirical analysis of the relationship between credit exclusion and farmer income using quantile,the characteristics of principals,family resource endowments and social capital also have an impact on the income of farmers at different income levels,but the degree of influence is different.Based on the empirical results,the article puts forward some policy suggestions:(1)The government should improve the policy support system,increase support for financial institutions' rural businesses and guide the regulation of rural informal financial markets.(2)Financial institutions should actively innovate financial service products,broaden the types of business,strengthen the promotion of financial products,and improve the financial literacy of farmers.