A Study On The Factors Affecting The Income Gap Between Urban And Rural Residents In Jiangsu Province

Since the reform and opening up, the income level of both the urban and rural residents has experienced dramatic promotion along with the rapid development of China’s economy. At the same time, however, the income gap between urban and rural residents has been widening. For Jiangsu Province, although its income gap between urban and rural residents has been one of the smallest among all the provinces in China, its leading position has been under increasing attack from other provinces like Zhejiang in recent years. Furthermore, according to the current income gap between its urban and rural residents, there’s still a long way for Jiangsu to reach the goal indicator set by the basic realization of modernlization. Therefore, this study has some theoretical and practical significance.On the basis of the literature review, the article firstly made an overall descriptive analysis of the urban-rural income gap of Jiangsu province, including both the longitudinal trend analysis and the comparative analysis between differrnt areas. Then on the basis of the method in which Chen Zongsheng established his analytical model of urban-rural income gap in public economy, with the supplementary of the analysis Kuznets offered in his inverted U theory and the combination of the real influnces and the specific circumstances brought by the reform and opening up, we finally built a comprehensive analytical framework towards the factors of urban-rural income gap, which included 15 indicator variables such as per capita GDP and its growth rate, the level of social assistance and so on. And then we did principal components regression analysis towards Jiangsu and Zhejiang province respectively with their related data between 1995-2014, and the empirical research estimated the quantitative relationships between the factors and the urban-rural income gap of the two provinces, from further comparative analysis of which we could summarize the reasons for the main problems behind the change process of the urban-rural income gap of Jiangsu province. Finally, the article made corresponding recommendations according to the main conclusions of the empirical analysis, including the optimization of the educational structure, the strengthening of the comprehensive agricultural development, the overall development of urban and rural social security system, the improvement of the rural financial service system, the optimization of the urban development mode and the structure of financial support for agriculture, the maintaining of the dominant position of public capital, less reliance to foreign investment and more endogenous dynamics from our regional economy.