【正文】
l repression and financial deepening” by taking the developing nations as their research sample. They thought that the main reason leading to financial repression was the separation of the economy. The existence of the segregation of the economy determines the splitting and weakening of the financial system. The signs of financial repression in the developing nations result from im perfect financial markets. Those who get loans are usually “ special sectors and industry.” The small and medium traders and farmers who urgently need capital cannot be satisfied with such simple financial instruments. The finan cial repression in the rural financial system of China is quite obvious and is inconsistent with the target for the rural financial system and rural economic and social development. ? Inconsistency between the expected development of rural cooperative financial institutions and the slow development of rural cooperative economic organizations Evidence shows that rural cooperative economic organization plays an irreplaceable role in facilitating rural economic financial development. For eign experience has also shown that many financial institutions operating in rural areas are in the form of cooperatives. Government supports the devel opment of the rural economy through some preferential policies to coopera tive financial institutions. These cooperative financial institutions still play an important role in the rural financial system. Credit cooperatives are gener ally consistent with the development of overall cooperative economic orga Page 6 62 THE CHINESE ECONOMY nization. If there is no development of cooperative economic organization but only credit cooperatives, better results cannot be achieved. Today the rural financial system of China faces a dilemma because it lacks a cooperative economy in the rural areas. In fact, there has been no actual cooperative economy in China. The agricultural cooperative movement in the early 1950s was in essence a collective movement, since property rights and identity freedom of farmers had been abolished at that time. After the household contract responsi bility system was set up and the collective economy also gradually vanished, there was no guidance for the development of a cooperative economy. Up to the present, there has been no actual cooperative economy in China. ? Rural financial system receives great interference from th