Effects of credit constraints on rural household technical efficiency

Jianmei Zhao and Peter J. Barry

China Agricultural Economic Review, 2014, vol. 6, issue 4, 654-668

Abstract: Purpose - – The purpose of this paper is to evaluate the effects of access to formal credit on rural household technical efficiency in China. Design/methodology/approach - – Based on the rural household survey data in Weifang city, Shandong province in northern China, the authors apply recent developed bootstrapped DEA approach to investigate rural technical efficiency at the household level under the consideration of off-farm activities. Rural households are then identified as credit constrained and classified as supply-side and demand-side credit constraints by applying direct elicitation method. Finally, the authors apply a tobit regression to examine the effects of credit constraints on household technical efficiency. Findings - – Rural households in China not only suffer supply-side credit constraints, but also demand-side credit constraints resulted from the transaction costs and risk rationing. The tobit regression discloses that demand-side credit constraints impose significant negative impacts on household technical efficiency. Originality/value - – The authors clarify the definition of credit constraints and classify the credit constraints into supply-side and demand-side credit constraints. The results of this paper have significant policy implications for rural finance policies in China.

Keywords: China; Agricultural technology; Bootstrapped DEA; Credit constraint (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:caerpp:v:6:y:2014:i:4:p:654-668

DOI: 10.1108/CAER-10-2012-0115

Access Statistics for this article

China Agricultural Economic Review is currently edited by Dr Fu Qin, Dr Jikun Huang, Dr Kevin Z Chen, Dr Weiming Tian, Prof Daniel Sumner, Prof Xian Xin and Prof Holly Wang

More articles in China Agricultural Economic Review from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().