Chinese rural household has been always facing credit constraints. Few institutions lend loans to farmers because of financial risks. Farmers have to use usury or other informal sources to meet the financial needs for production. This credit constraint has been forcing farmers to deviate from...

Purpose – The purpose of this paper is to examine the effect of credit constraints on agricultural productivity in China. Design/methodology/approach – Using data from a rural financial survey, a switching regression model is used to account for endogeneity and heterogeneity. Carter presents...