The Study Of The Rural-urban Income Inequality--A View From The Role Of Human Capital To Drive Economic Growth

Since the reform and opening,great achievements have been achieved in China's economic development in urban and rural areas,which grabbed the attention of the world.As the economy has experienced sustained and high-speed development nearly 30 years,tremendous changes have taken place in China' s urban and rural areas.Along with the income rise of rural and urban residents,the gaps in many respects are widening. Although certain disparities between urban and rural areas and regions are inevitable in the course of economic development,it will undoubtedly affect the quality of the economic development if the gaps are too wide.The gap in economic development between urban and rural areas has become an important factor affects China's economic development and social stability in the future,also a serious problem in the course of China's modernization.They are nothing else but the increase in capital and labor and technological progress in terms of the source of economic growth ,and of which,human capital is of vital importance.As the sustained driver of economic growth,the increase of human capital greatly quickens technical progress and brings a rapid growth in output.Corresponding to the urban-rural gap,such difference also exists within human capital. To shorten the income gap between urban and rural areas,we need develop vigorously the human capital.The central issue of narrowing the income gap between urban and rural areas is to increase the human capital content.Standing on the status quo of China's huge rural-urban income inequality,this paper uses the human capital theory and relevant methods of economic research according to statistical data from 1998 to 2006.First,this paper measures the human capital of every province in China.Then it makes an regression analysis of the relationship between the human capital investment and economic growth of every province in China with the aid of Panel Data Analysis based on the attained data,and makes a judgement that the human capital plays an important role in economic growth.From an analysis of the human capital's effect on economic growth in the eastern,central and western regions of China,we can find that the contribution rate of eastern human capital for China's economic growth is greater than that of material capital.Finally ,this paper draws a conclusion that the rural human capital produces an greater effect on economic growth compared with the urban human capital by making quantitative analysis on the effects of the human capital in urban and rural areas on economic growth respectively. According to the quantitative analysis results,this paper puts forward suggestions on strategic choice for minimizing income disparity between urban and rural areas based on the theory contributes to coordinating development of different areas.