The Impact Of International Trade On Chinese Income Distribution Gap

In recent years, it is an important issue about the widening of the income distribution gap and its influencing factors in the economic field in the world. At present, there are many scholars focus on the relationship between trade and income distribution gap, however, the result may vary. Most of scholars describe the time series data or cross section data for research and panel data is seldom used. Meanwhile, it is very rare to study the rural income distribution and employment wage income distribution from the perspective of the import and export.As the income source between urban residents and rural residents is different, the influences from international trade on them vary. Similarly, as our country employment populations distribute in different industry, international trade and international capital flows may have diverse effect on them for different business features. In view of the above reasons, this article will study the effect of international trade on income distribution gap from the perspective of Ratio of Income and Theil index. Now consider the geographical environment in our country, some of peripheral provinces border on neighboring countries, and he rest have coastline. Inland provinces have to transport goods through peripheral provinces to participate in international trade. As factors like factor endowment and economic foundation are different between inland provinces and peripheral provinces, they will have different influence degree on those two kinds of provinces. Based on the above ideas, the analysis of Ratio of Income and Theil index will be analyzed respectively from two aspects of peripheral and inland provinces.Below are the logical thoughts of empirical analysis in this article. First of all, examine the impact of total volume of foreign trade, total imports and exports respectively on Chinese urban and rural residents’income distribution gap. Then analyze the difference of the effect of international trade on income distribution gap between peripheral and inland provinces. After that, analyses the Impact of international trade on Chinese employment wage income distribution gap in the same way. The final conclusion:International trade increases will widen income distribution gap in our country. Exports will help to narrow the gap in income distribution, while imports will expand both in peripheral and inland provinces. While, the marginal impact of exports are less than imports. Under the condition of the gap between total import and export is not big, increased trade will lead to increasing income distribution gap. Finally, put forward related policy Suggestions based on the above conclusions.