AJIBM  Vol.4 No.9 , September 2014
A Study on the Effectiveness of Financial Supports to the Entrepreneurship of Farmers—Based on the Data from 1978 to 2011 in China
Abstract: We use a fixed effect variable coefficient model to analyse effectiveness of financial supports to the entrepreneurship of farmers, based on the data from 1978 to 2011 in China. Results show that due to the significant differences in regions among farmers’ entrepreneurship, the demand of rural financial supports for the peasants’ entrepreneurship is distinct; the different rural financial supports for farmers’ entrepreneurial also exist. The financial supports of developed eastern provinces to the entrepreneurship of farmers are effective, while that of the underdeveloped provinces in middle and western China is opposite. At last, focusing on market failure that farmers in poor areas encountered, like the rural imperfect financial system, the credit guarantee system, the asymmetric information and high transaction cost, some suggestions are given in this paper, such as the encouragement of the micro-finance for farmers’ entrepreneurship, standardizing and guiding the informal finance for farmers’ entrepreneurship and the establishment of risk fund for farmers’ entrepreneurship.
Cite this paper: Liu, X. , Li, L. , Du, C. and Liu, Y. (2014) A Study on the Effectiveness of Financial Supports to the Entrepreneurship of Farmers—Based on the Data from 1978 to 2011 in China. American Journal of Industrial and Business Management, 4, 523-530. doi: 10.4236/ajibm.2014.49058.

[1]   Hao, C.Y., Ping, X.Q., Zhang, H.Y. and Liang, S. (2012) Entrepreneurial Choice and Its Influencing Factors of Farmers-Evidence from “Financial Investigation”. Chinese Rural Economy, 4, 57-65.

[2]   Gu, J.J. and Xie, F.H. (2012) Analysis on Entrepreneurial Activities Affecting Farmers’ Income in Different Regions— Based on Provincial Panel Data from1997 to 2009. Issues in Agricultural Economy, 2, 19-23.

[3]   Folmer, H., Dutta, S. and Qud, H. (2010) Determinants of Rural Industrial Entrepreneurship of Farmers in West Bengal: A Structural Equations Approach. International Regional Science Review, 33, 367-396.

[4]   Foon, J.P.H., Thai, D.T. and Naybor, D. (2012) Social Capital and Female Entrepreneurship in Rural Regions: Evidence from Vietnam. Applied Geography, 35, 308-315.

[5]   Liu, T.Y. (2010) Analysis on the Impact Factors of the Peasant Workers’ Returning to Hometown to Venture: Based on the Survey of Ganzhou Area in Jiangxi Province. Issues in Agricultural Economy, 9, 81-87.

[6]   Zhang, H.Y. and Yuan, Y.J. (2011) Village’s Financial Environment and Farmers’ Entrepreneurship. Zhejiang Social Sciences, 7, 2-12.

[7]   Stiglitz, J. and Weiss, A. (1981) Credit Rationing in Markets with Imperfect Information. American Economic Review, 71, 393-410.

[8]   Carter, M.R. (1988) Equilibrium Credit Rationing of Small Farm Agriculture. Journal of Development Studies, 28, 83-103.

[9]   Cheng, Y. and Luo, D. (2011) Entrepreneurial Farmers’ Choiceunder Credit Constraints—An Empirical Analysis of Chinese Household Survey. Chinese Rural Economy, 3, 28-35.

[10]   Xiao, H.F. and Bao, X.L. (2009) Credit Constraints of Farmer Entrepreneurship—An Empirical Study of 930 Rural Micro-Enterprises in Hubei Province. Journal of Agrotechnical, 11, 25-38.

[11]   Zhao, X.H. and Zhou, S.D. (2012) Current Situation of Farmer Entrepreneurship, Its Influencing Factors and Countermeasures. Jianghai Academic Journal, 1, 217-222.

[12]   Luo, M.Z., Zou, J.Y. and Lu, Y.X. (2012) The Motivation, Demand and Support for Farmers’ Entrepreneurship. Issues in Agricultural Economy, 2, 14-19.

[13]   Evans, D.S. and Jovanovic, B. (1989) An Estimated Model of Entrepreneurial Choice under Liquidity Constraints. Journal of Political Economy, 94, 808-827.