| There is a serious imbalance in the development of Chinese urban and rural compulsory education, it would have serious negative social effect, but the primary government in rural areas could not meet the needs of the development of compulsory education due to financial constraints. The financial transfer payment is an important means to solve this problem. Then, we had to improve the financial transfer payment system of the compulsory education to ensure that national and provincial governments to increase funding for rural compulsory education and promote a balanced development in urban and rural areas.This paper base on the partial equilibrium theory of public goods and the law of diminishing marginal utility, research the financial discrepancy of urban and rural compulsory education of Xing'ning Region in Nanning city by method of literature analysis and the survey. Through the theoretical and empirical analysis of financial transfer payment to play the role to achieve equilibrium of the urban and rural compulsory education of Xing'ning Region, we pointing out that the existing financial transfer payment in the development of compulsory education has played a significant role, Also play over the balanced development of urban and rural compulsory education. But financial Transfer payments hasn't explicit allocation of funds in urban and rural areas, there are visible defects on achieve the objectives of balanced development of compulsory education in urban and rural areas still. Therefore, the paper put forward the some point. First, we need to consider differences in the region before choose the form of fiscal transfer payment. Second, it should establish an independent education budget, on this basis, the funding system to equalization also necessary to be found. It ensures that educational investment tilt to the rural areas and narrowing the gap between urban and rural areas. Last, it needs to improve the evaluation and monitoring mechanism.
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