Research On The Impact Of Farmers’ Financial Literacy On Financing Availability In Hunan Province

The No.1 Document of the CPC Central Committee has been focusing on "agriculture,rural areas and farmers" for 18 years.In 2021,Hunan Provincial Party Committee issued the No.1 document with the theme of "Opinions on Comprehensively Promoting Rural Revitalization and Accelerating the Implementation of Agricultural and Rural Modernization".Rural finance is crucial for implementing the rural vitalization strategy,promoting high-quality and efficient agriculture,making rural areas more livable and productive,and making rural residents more prosperous.How to strengthen the financial services of rural revitalization and how to improve the service system of rural finance,so as to meet the financial demand of farmers in the financial market,is the key to promote rural revitalization.Based on the level of financial literacy of farmers,this paper tries to explore the internal relationship between the level of financial literacy of farmers and the availability of financing.This paper measures the financial literacy of farmers from three dimensions of financial knowledge,financial skills and financial consciousness.The financing availability of farmers is measured from three dimensions: financing demand,financing channel and financing availability ratio.Finally,with the help of financial literacy theory,credit rationing theory,financial deepening theory and other theories,the mechanism of the effect of farmers’ financial literacy on farmers’ financing availability is comprehensively analyzed.According to 652 field survey data in 7 counties and cities of Hunan Province,entropy weight method is adopted to measure the overall level of financial literacy,financial knowledge,financial skills and financial awareness of farmers.The financing availability of farmers is measured from whether they have financing needs,whether they choose formal or informal channels for financing,and the specific ratio of financing availability of farmers,so as to construct the theoretical framework of the impact of financial literacy on the financing availability of farmers.Probit model and Tobit model were established to test the influence of financial literacy on farmers’ financing willingness,financing availability ratio and financing availability.Thirdly,we use instrumental variable method to test the endogeneity of empirical results.The score summation method was used to reconstruct financial literacy indicators for robustness test.Finally,the following conclusions are drawn :(1)the overall level of financial literacy of farmers in hunan province is low.Farmers in Hunan province need to improve their grasp of financial knowledge and lack of experience in participating in financial practice.(2)The level of financial literacy of farmers has a significant and positive impact on financing demand.To improve the level of financial literacy of farmers in Hunan province is conducive to maintaining the sustainable operation of farmers and expanding their business intentions,thus increasing the financing needs of farmers.(3)Farmers with higher level of financial literacy have higher availability of financing funds.(4)In addition to financial literacy,other variables,such as farmers’ age,education level,annual household expenditure and annual income,also affect farmers’ demand for financing amount and financing availability to varying degrees.