Author(s)

Tong Wu, Zhiwen Peng, Rong Hu, Xiaoqian Liao, Tongyue Zhao

Corresponding Author

Tong Wu

Abstract

Rural small and micro enterprises are an important force to promote the diversification of the rural economy and realize rural revitalization, but they have been facing financing constraints for a long time. Based on the data of rural MSMEs in China by province from 2012 to 2021, this paper explores the influence mechanism of the development level of the rural financial system and the increase of agriculture-related loans on the development of rural MSMEs and the moderating effect of the level of regional economic development by using a fixed-effects model. It is found that the level of development of the rural financial system and the expansion of the scale of farm-related loans significantly promote the development of rural MSMEs, in which the direct effect of farm-related loans on the development of enterprises is particularly prominent; the level of regional economic development significantly positively regulates the promotion effect of farm-related loans on rural MSMEs, but the regulating effect on the development of the financial system as a whole is not significant. The results of this study provide empirical evidence for improving the construction of the rural financial system, optimizing the allocation of agricultural credit resources and implementing regionally differentiated financial support policies.

Keywords

Rural Financial System; Rural Micro and Small Enterprises; Agricultural Loans; Fixed Effects Model