Social Network,Household Debt And Consumption In Farmers

With the gradual fermentation of the trend of anti-globalization and the the complicated international situation,if China wants to maintain sustained and stable economic growth,it must consider expanding domestic demand as the long-term strategic policy and basic standpoint of China’s economic development.China’s rural consumer market has huge potential.How to vigorously develop rural finance,expand rural consumer markets,and help rural revitalization strategies has become the focus of academic circles.Family finance has always been a hot topic in financial research,mainly including two aspects of household debt and household asset allocation.Household debt can affect household consumption to a certain extent,but there is relatively little research on household debt.Research usually assumes that economic entities are independent and self-interested,and their interactions will not affect their economic behavior.This paper uses the data in the "China Family Panel Studies(CFPS)" database conducted by the China Social Science Survey Center of Peking University in 2016 to study social networks,rural household debt,and household consumption under a unified framework.This article first explores the impact of social networks on rural households ’debts,and refines rural households’ liabilities from different perspectives.The results show that social networks have significant effects on household debt,the scale of debt,and the proportion of debt in total assets.Positive impact of household debt;if the analysis of household debt is divided into formal financial channel liabilities and informal financial channel liabilities according to the source of borrowed funds,social networks have asignificant positive impact on liabilities from these two sources,but There is a large difference in the impact of debt types,and the results show that social networks have a greater role in promoting debt from informal financial channels.When discussing the impact of rural household debt on household consumption,if household debt is used as the purpose of debt funds,There are two types of housing liabilities and non-housing liabilities.When household consumption is divided into durable goods consumption and durable goods consumption,the two types of liabilities have a positive impact on durable goods consumption and non-durable goods consumption expenditure.Housing debt has a greater impact on consumer spending on durable goods;According to the source of liabilities,the court liabilities are further divided into three types of bank loans,family and friends loans,and private loans.The three types of liabilities have different repayment terms and interest rates.The regression results show that loans from banks and friends and relatives It has a significant positive impact on consumption,and the impact of private borrowing on consumption is not significant.In the influence of social networks on household consumption,the elements of household debt have a certain intermediary effect,that is,social networks can affect household consumption by affecting the level of household debt,which theoretically integrates the factors of household finance into the impact of household consumption The mechanism has further improved the theoretical framework of social networks to promote rural household consumption.Based on the previous empirical analysis,this article proposes the following: First,actively establish various social network platforms in rural areas.Establishing more interest groups and non-governmental organizations in the village can not only enrich the leisure life of farmers,but also organize multiple activities to expand the channels for farmers to exchange information,and also create conditions for the establishment of harmonious relations between farmers To stimulate household debt and expand the rural consumer market;the second is to regulate the development of informal financial markets in rural areas.Informal financial markets in rural areas will be affected by the level of family social networks.Compared with formal finance,informal networks based on social networks are more in line with farmers’ communication habits,and can also solve the problems of adverse selection and moral hazard.It is necessary to strengthen the supervision and appropriate control of informal finance,especially private lending,so that the informal financial market can make up for the vacancy of the formal financial market in rural areas,so as to enhance the ability of rural households to smooth consumption.Third,improve the rural consumer financial system.Formal financial institutions shouldpay attention to the credit needs of rural residents,and include social network surveys in the review of their loan qualifications,in order to build a more comprehensive and accurate credit distribution mechanism for rural households,and promote the development of rural finance in China to release rural The huge consumption potential of the region and the expansion of the rural consumer market will help China’s economic development.