The Research On The Impact Of Trade Liberalization On China's Income Distribution Gap

Since the reform and opening up policy was adopted by China in 1978, the economic growth has been increasing rapidly, the income distribution gap of China is expanding, Especially in the 1990s.At the same time, China's trade liberalization level has been improved, the foreign trade quantity, the foreign trade growth rate and the dependence degree of foreign trade have been increasing. We focus on the impact of trade liberalization on income distribution gap in this paper. This paper analyses this problem with the new technique of economitrics from long-term and short-term points. We find that the trade is one of the important causes that lead to income distribution gap.In the first chapter, we introduce the meaning and background of selecting this subject, then summarize the relative papers on this subject, introduce the content, way of studying and the innovation of this paper.In the second chapter, at first , we introduce the definitions of trade liberalization, income and income distribution gap,and how to measure them .Then we describe the latest development of trade liberalization and income distribution gap in China. We think that the total foreign trade quantity has surprisingly increased and the import and export commodity structure have greatly changed in these two decades since the reform and opening up policy was adopted by China in 1978.As the trade liberalization of China increasing, income distribution gap expands, and the Gini coefficient of China increases except some years which even passes the international alarming level 0.4. The urban-rural residents'income distribution gap is a pretty large proportion of income distribution gap of China, and there are income distribution gap in eastern, mid and western regions and in different trades.In the third chapter, most researchers agree with the point that the trade impacts the national income distribution gap, but how does the trade impact income distribution and through what channels, in this chapter we consider that the trade impacts income distribution through the following 6 channels: price of commodities, changing the impact of government, technology improvement, adjusting the structure of the industry, foreign direct investment and consumer preference.In the fourth chapter, at first, we give an empirical analyse on trade liberalization impacts the income distribution gap by pool data model and we find that the degree of dependence of trade increases the income gap. Then we use the time serious to analyse the relationship between the trade liberalization and the income gap, use multi-variables cointegration technique, test long-term equilibrium relations between the degree of dependence of foreign trade and income gap. The granger causality test and impulse response function indicate, in the short run, the degree of dependence of foreign trade expands the income gap.In the fifth chapter, we conclude the whole paper and advance suggestions.