Can financial literacy promote rural entrepreneurial resilience? Exploring the asymmetric role of formal and informal credit in China

Enhancing resilience is crucial for sustainable rural entrepreneurship, yet existing research has not fully clarified the role of financial literacy in this process. Based on data from the China Family Panel Studies (CFPS) 2014-2022, this study empirically examines the impact of financial literacy on rural households’ entrepreneurial resilience and the moderating effects of formal and informal credit access, using instrumental variable method to address endogeneity and 5%/95% bilateral winsorization for robustness tests. The results show that financial literacy significantly promotes rural households’ entrepreneurial resilience; formal credit access positively moderates this relationship, while informal credit access has no significant moderating effect. This study enriches the literature on factors influencing rural entrepreneurial resilience and provides policy implications for improving farmers’ financial literacy, optimizing rural credit services, and supporting sustainable rural entrepreneurship.