The availability of credit has long occupied a central place in development strategies. Rural credit institutions are more than an instrument of intermediation, they also handle risk, mobilize and disseminate information about market and technology. Given the informational problems and innate disadvantages of rural credit markets, the rationale for laissez-faire and liberalization is by no means based on a sound understanding of the state’s role in redressing market failures. This study examines the rural credit market in China, its impacts on agricultural transformation and the state’s role in the functioning of markets. The particular objectives are to identify the determinants of credit rationing in both formal and informal sectors, to show the extent of credit rationing, to reveal the dynamic role of institutional lending in agricultural transformation, and to understand the challenges in developing efficient institutions.
Frankfurt am Main, Berlin, Bern, Bruxelles, New York, Oxford, Wien, 2008. XVI, 146 pp., num. tables and graphs
Contents: Agricultural Transition in China: A Historical Perspective – Evolution of China’s Rural Financial Market
– Rural Credit Markets in Developing Countries: A Theoretical Review – The Determinants of Credit Rationing – Interlinked
Formal and Informal Credit Markets – Institutions, States and Rural Finance – Agrarian and Local Institutions – Rural Financial