Farmers´ Financial Knowledge and Access to Formal Financial Credit in Rural China

Knowledge levels of different social groups vary. Rural society members divide into groups with the economic reform in China. The structure of rural society becomes complex and rural society stratifies seriously. We test the financial knowledge level of different regions in rural China with empirical analysis using data collected from eastern and western China and analyze the effect of financial knowledge level on farmers´ credit constraint of formal financial organizations. The results reveal that financial knowledge levels vary in different regions of rural China. Farmers with higher level of financial knowledge confront lower level of credit constraint.