Social Capital in Cooperative Memberships and Farmers’ Access to Bank Credit–Evidence from Fujian, China

For rural communities in poor countries to develop, farmers need money invest their farms. However, with limited assets of own and conditions for obtaining loans, the farmers’ operations suffer. This study explores how chances a bank loan are related social capital that they receive from cooperative membership. The data originated 743 Fujian province, China, was analyzed help instrumental variable probit (IV-probit) regression model. results show (a) members have higher chance compared non-members; (b) membership positively influences no acquaintances banks government or off-farm work; (c) among financial knowledge, more likely than non-members are. Therefore, conclusion provides empirical evidence function cooperatives farmers. findings especially relevant developing countries, call establish institutions. Moreover, research conclusions point out direction further improving effect cooperatives.