Study On The Factors Affecting The Income Gap Between Urban And Rural Areas In Shaanxi Province

Since the reform and opening-up, China's economic development rapidly, and the economy continues to improve, each have achieved great success. But along with the economic growth is not only the improvement of people's living standard, but also the widening income gap between urban and rural residents. Compared with the national, Shaanxi Province economy grows lag behind, but the income gap between urban and rural areas is higher than the national average. As the core of the western region provinces, the study of Shaanxi province gap between urban and rural residents income can also partly reflect the situation of the western region.This paper studies on the factors affecting the income gap between urban and rural areas in Shaanxi Province. Base on the reforming economic background, respectively from the economic growth, urbanization, industrialization and fiscal policy four aspects to specific analysis the influence of the income gap between the urban and rural residents in Shaanxi Province. So by using its data during the year of 1978 to 2009 and based on the foundation of vector auto-regression model, this paper applies impulse response function and variance decomposition to analysis the factors on income gap between the urban and rural areas, and these conclusions include:In the short term, the urbanization has a great influence on the income gap between urban and rural areas in Shaanxi Province, and accelerating the urbanization is contribute to narrow the income gap between urban and rural areas; The financial support from the government has the tendency of city in Shaanxi Province, So we have to increase the agriculture spending; Education spending is not conducive to narrowing the income gap between urban and rural areas, it is beneficial to urban residents. So we need to adjust the structure of education spending; The income gap between urban and rural areas in Shanxi Province with the inverted U-Kuznets curve.For the results of the study, we should not only keep the foundation of stability to the economic development, but also pay attention to make measures to strengthen those factors that can narrow the income gap between urban and rural areas and eliminate or weaken those factors that can expand the income gap between urban and rural areas.