Do formal credit constraints affect the rural household consumption in China?

Do formal credit constraints affect the rural household consumption in China?

Blog Article

The article investigates the Chair Beds consequences of credit constraints on rural household consumption in China.Based on a unique rural finance and consumption survey, the authors first identify the credit constraint status of rural households from formal financial institutions.Then, they apply an endogenous switching regression model to compare the consumption responses to household production inputs for credit constrained and non-constrained households.The estimation results reveal that the credit constraint could result in the crowding out effect of the aggregate household consumption from its production Sinus Wash Sachets inputs.

Nonetheless, similar to the non-constrained households, the credit constraint households are capable of smoothing their necessary consumption.