Research On The Development Of Inclusive Finance And Urban-rural Income Distribution

Income distribution gap between urban and rural areas has been a prominent contradictions and the focus of China's economic and social development.Urban-rural income inequality is the main source of integral inequality of income distribution in China,on the whole it is in high volatility change trend in recent years,although the gap between urban and rural residents income level for the twice time in 2015 to below "three times",but the absolute value of the gap rose to 19773 yuan,the situation of the gap is not optimistic.As a circulation of elements and important way of resources disposition,the development of rural finance and the whole finance is the important factor affecting the income gap between urban and rural areas.Under this background,the concept of “inclusive finance” which is put forward by the financial aspects is cognitive further than traditional finance.Inclusive finance stresses providing financial services for all economic subjects especially low-income rural society is all-round and effective.Pushing the development of the finance with inclusive connotation and enlarging the coverage and availability of financial services can guide the financial resources' configuration to the disadvantaged,vulnerable groups in areas,it is very important to solve the problem of poverty and improve income distribution between urban and rural areas,etc.To this end,the central and local governments at all levels in China also carry out the inclusive financial strategy to alleviate the financial exclusion and realize the development of urban and rural areas as a whole,and gradually promote the development of the various types of inclusive finance such as microfinance,Inclusive finance constantly enriches the connotation of the concept,continuously innovates the form,expands inclusive degree.Inclusive finance has obvious characteristics of age from the concept of public welfare microfinance to innovative Internet finance.Today,the development of inclusive finance in our country has entered a new stage,risen from a concept framework of financial development to financial development strategy of national level,the framework of inclusive finance has formally entered the “top-level design”.So,how to evaluate the degree of financial inclusion? To what extent the development of inclusive finance can affect the income gap between urban and rural areas in China? It is trying to solve an important problem in this paper.The most key link of the research on Inclusive Finance is how to make scientific measure to its level of development and evaluation.According to the related research at home and abroad about Inclusive Finance's metrics,in combined with the practice of Inclusive Finance's development in our country and on the basis of the data availability,this paper puts forward from two dimension of the permeability and the utility of financial services synthetise index of financial inclusion.In order to reflect the different contribution rate of the index variables for inclusive financial development,the variation coefficient method is used to determine the index weight.So,in this paper,index of financial inclusion is constructed to measure accurately degree of inclusive financial development of various provinces and our country on the basis of the variation coefficient method to determine index weight.Analyzing the related measure results,the paper can get the following conclusions:(1)the permeability of “geographical dimension” in the present stage can play a more dominant effect on the development of inclusive finance,and the weight of “the utility of financial services” dimension is low,the use efficiency of the financial services is still not ideal,its contribution to the development of inclusive finance is small;(2)the disparity of the provincial inclusive finance is very enormous in our country,but provincial difference of inclusive financial development is reducing year by year.In addition,the obvious regional difference of characteristic is “high in the east,middle in the center,low in the west” about China's provincial Index of Financial Inclusion;(3)The two sides of supply and demand about financial products and services and the government's economic policy orientation has brought up provincial space-time evolution pattern of inclusive financial development level in our country.The income distribution effects of financial development can be divided into the income distribution time effects of financial development level and the income distribution space effects of financial development level.Therefore,on the basis of the theoretical analysis on the income distribution effects of financial development as well as the measure of inclusive financial development's degree in the national and provincial level,this article respectively makes an empirical analysis on income distribution effects of inclusive financial development from the two-dimensional perspective of the time(national level)and space(provincial level),further gets the evidence of urban and rural income distribution effects of inclusive financial development.First of all,the paper makes empirical analysis on the relationship between nationwide inclusive financial development level and the urban and rural income distribution gap from the time dimension.SVAR model is presented in this paper,and the relationship between inclusive finance's degree and the urban and rural income distribution gap in our country is examined in detail through the impulse response function and variance decomposition analysis,the research draws the following conclusion: there is a long-term equilibrium relationship between inclusive degree of financial development and income distribution gap between urban and rural residents in China,inclusive finance especially rural inclusive finance play a significant positive effect on reducing the urban-rural income ratio and improving the income distribution between urban and rural areas,it also shows the inclusive development of finance which has the inclusive connotation has greater effect on poverty reduction than imbalanced effect of the financial development(i.e.,the sum of the threshold effect and exclusion effect of the financial development),the symbol of the synthetical effects between inclusive finance and urban and rural income distribution is positive.Secondly,the paper makes empirical analysis on the relationship between provincial inclusive financial development level and the urban and rural income distribution gap from the spatial dimension.In this paper,a spatial econometric model is constructed in order to test empirically the relationship between provincial inclusive finance's degree and the urban and rural income distribution gap using cross-section data of 30 provinces in 2014,the conclusion is as follows:(1)there is significant positive spatial correlation between provincial inclusive financial development level and the urban and rural income distribution gap,provincial inclusive financial development and the distribution gap has positive spillover effect;(2)the development of provincial inclusive finance has significant effect on narrowing the income gap between urban and rural areas,but there is not identical relations between inclusive financial development and urban-rural income gap in provincial level,in particular there is "U" relationship in a sense;(3)the development of provincial inclusive finance through spatial geographic mechanism played a promoting role in improving the urban and rural income gap,and the surrounding provincial inclusive finance's development has spillover effects on the provincial region's improvement of the income gap between urban and rural areas,but the spillover effect or regional radiation effect is not obvious.Finally,according to the above conclusion,this paper puts forward related policies about the development of inclusive finance and the adjustment of urban-rural income distribution's imbalance.First of all,to achieve real inclusive finance,we must build our country's current the framework of inclusive finance from the customer,micro,meso and macro level at the same time.Secondly,according to a weighting of each index for two dimensions of the financial services,we can decide which dimension in the present stage is playing a more dominant effect on the development of inclusive finance,thus put forward suggestions for the development of key dimensions to the financial service.Thirdly,according to the test result of the relationship between inclusive financial development and urban-rural income distribution from the space-time two-dimensional perspective respectively on the national level and provincial level,on the one hand,the central government should create inclusive financial system to improve China's current imbalance of urban and rural income distribution;on the other hand,the provincial government should make the regional spatial mutual effect included in the analysis and policy-making's process about the development of inclusive finance and urban-rural income distribution's imbalance,and pay attention to the linkage of the provinces in the economic geographical space,and promote the development of the income gap between urban and rural areas to the benign direction.