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Inclusive Finance, Farm Households Entrepreneurship, and Inclusive Rural Transformation in Rural Poverty-stricken Areas in China

Author

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  • Tian Liu
  • Guangwen He
  • Calum G. Turvey

Abstract

Financial inclusion is an important part of inclusive rural transformation because it provides access to, and use of, capital to underserved rural households. However, with increased entrepreneurial activities, it begs the question as to the extent by which access to credit actually encourages entrepreneurial activities. Using survey data of 988 farm households in state impoverished counties of China, we find that financial inclusion plays an important role in inclusive rural transformation by facilitating farm households’ entrepreneurial activities in rural poverty-stricken areas in China. The survey provides evidence that the entrepreneurial decisions of farm households are positively affected by use of credit rather than access to credit. In addition, when it comes to entrepreneurial decisions, use of formal credit and use of informal credit have no statistical relationship, but operate under separate and statistically distinct channels. Moreover, entrepreneurship has a positive and significant causal effect on income of farm households.

Suggested Citation

  • Tian Liu & Guangwen He & Calum G. Turvey, 2021. "Inclusive Finance, Farm Households Entrepreneurship, and Inclusive Rural Transformation in Rural Poverty-stricken Areas in China," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 57(7), pages 1929-1958, May.
  • Handle: RePEc:mes:emfitr:v:57:y:2021:i:7:p:1929-1958
    DOI: 10.1080/1540496X.2019.1694506
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    Citations

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    Cited by:

    1. Mingzhao Xiong & Wenqi Li & Brian Sheng Xian Teo & Jaizah Othman, 2022. "Can China’s Digital Inclusive Finance Alleviate Rural Poverty? An Empirical Analysis from the Perspective of Regional Economic Development and an Income Gap," Sustainability, MDPI, vol. 14(24), pages 1-18, December.
    2. Badeeb, Ramez Abubakr & Wang, Bo & Zhao, Jun & Khan, Zeeshan & Uktamov, Khusniddin Fakhriddinovich & Zhang, Changyong, 2023. "Natural resources extraction and financial inclusion: Linear and non-linear effect of natural resources on financial sector," Resources Policy, Elsevier, vol. 85(PA).
    3. Dong, Jiajia & Dou, Yue & Jiang, Qingzhe & Zhao, Jun, 2022. "Can financial inclusion facilitate carbon neutrality in China? The role of energy efficiency," Energy, Elsevier, vol. 251(C).
    4. Silin Liu & Jia He & Dingde Xu, 2023. "Understanding the Relationship between Financial Literacy and Chinese Rural Households’ Entrepreneurship from the Perspective of Credit Constraints and Risk Preference," IJERPH, MDPI, vol. 20(6), pages 1-15, March.
    5. Gao, Jingyi, 2022. "Has COVID-19 hindered small business activities? The role of Fintech," Economic Analysis and Policy, Elsevier, vol. 74(C), pages 297-308.
    6. Shao, KaiChao & Ma, Ruixue & Kamber, Joseph, 2023. "An in-depth analysis of the entrepreneurship of rural Chinese mothers and the digital inclusive finance," Telecommunications Policy, Elsevier, vol. 47(7).
    7. Dong, Kangyin & Taghizadeh-Hesary, Farhad & Zhao, Jun, 2022. "How inclusive financial development eradicates energy poverty in China? The role of technological innovation," Energy Economics, Elsevier, vol. 109(C).
    8. Lin Fu & Junko Sanada, 2023. "Spatial Patterns and Influencing Factors of Rural Land Commodification at Township Scale: A Case Study in Shijiazhuang City, North China," Land, MDPI, vol. 12(6), pages 1-14, June.

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