Research On The Development Of China’s Financial Impact On The Income Gap Between Urban And Rural Areas

As the core of modern economy and resource allocation, financialis closely linked to the stability of the entire national economy and playsa pivotal role in the market economy.Since the reform and opening ofChina’s financial development has been greatly improved, but showingregional differences, urban and rural development and other non-isolatedbalanced development. At the same time, the income gap between urbanand rural residents is constantly expanding, affecting the social stabilityand healthy economic development. In the explanation of the variousurban and rural income gap in China has formed, often overlooked impactof financial development. Study of income distribution from the financialperspective of development is significant.It helps to further ourunderstanding of the formation of income inequality.Firstly, the article arrange some sort of basic theoretical researchresults and financial developments at home and abroad,the income gapbetween urban and rural areas and urban agglomeration theory from thefinancial perspective influence the mechanism of urban-rural income gapanalyzes of financial development. Then use a large amount of statisticaldata from multiple aspects of the analysis of the financial situation andregional differences and urban-rural income gap in development. Again,the empirical analysis section, select provincial data of1991-2011years,the introduction of economic growth, urbanization level control variables development, industrial structure and employment structure to create adynamic panel model. Using the system GMM to test the financialdevelopments affecting the income gap between urban and rural areas ofthe country and the eastern, central, western. The empirical results showthat there is a first "inverted U" Kuznets effect between financialdevelopment and urban-rural income gap, at the regional level, theeastern, central financial development and income gap also existsKuznets effect, while financial development in the western region of theexpanding income gap between urban and rural areas. Meanwhile, thecontrol variables of economic growth, urbanization, industrial structureand employment structure of the income gap between urban and ruralareas, such as the impact is significant, but the impact effect of thepresence of regional differences. Finally, on the basis of empiricalanalysis, the article summarizes the main conclusions of this paperpresents some inspiration, as well as issues to be further studied.