Comparative Study On The Income Distribution Gap Between China And Russia During The Period Of Transition

It has been35years since China began to reform and opening-up;22years hasbeen passed after the collapse of the Soviet Union in1991then Russia began toimplement radical reform which called "shock therapy". Economy grow rapidly andthe income in both of the two countries throughout the transition period. The overallstandard of living are growing better and better with the income increased. However,the income distribution disparity between residents is persistent and continuouslywidening, unequal distribution of income and wealth disparity problems highlightedincreasingly.This paper first makes a practical and realistic analysis of the current situation ofincome distribution between the two countries. Then make a rational judgment to thereasonable of income distribution gap between China and Russia. Next with the helpof SPSS19.0analysis software, to analysis the main influence factors on cross sectionof the income distribution gap data between China and Russia (1995-2011). Theconclusion is that during the transition period of the emerging markets in the twocountries, neither the public expenditure on health and medical nor the naturalpopulation growth rate has significant impact on income distribution gap.While capitaGDP growth, foreign trade dependence, the added value of agricultural growth, finalconsumption expenditure, etc. A share of GDP, had net inflows of foreign directinvestment as a share of GDP, according to the consumer price index to measure therate of inflation, unemployment, institutions of higher learning enrollment proportionof the total, total capital formation as a share of GDP and the proportion ofagricultural population have significant impact on income distribution gap.China and Russia have to choose the proper public policies and measuresaccording to the different national conditions, transformation path and years oftransformation. China needs to accelerate the urbanization process, standardizeincome distribution, at the same time strike the unreasonable and illegal income,effectively maintain market order and increase the resident income. And provide moresocial insurance and produce more public goods. Russia need to increase the socialindustrial structure adjustment and industrial transformation, perfecting social security mechanism, increase the utilization rate of foreign investment and the development ofnational trade, in taxation to intensify regulation, control of the gap between rich andpoor disparity. All in all, according to national circumstances, choose to promoteeconomic growth, accelerate the transformation of dual structure, perfecting the socialsecurity system, increased public spending and tax regulation, and redistributivemeasures would be the last choice of transition countries like China and Russia tobalance the income gap.