The Research About Influence Of Income Distribution Gap On Regional Middle-income Trap

Middle-income trap refers to a country or region may encounter series problems after entering the ranks of middle-income, such as slow economic growth and social conflicts increased, eventually result in economic stagnation or lingering, and fall into “the middle-income trap”. But the income distribution refers to the economic activity that the social create the production, and segment it according to certain rules between social groups or members. The problems of fall into “the middle-income trap” and the big gap of income distribution are not only an important issue for economics but also two major economic problems faced in our country.The research findings based on the review of "middle-income trap" found that the huge of income distribution leads to the deficiency of domestic demand and urbanization quality, as well as he unsustainable of the pattern of economic growth may tempt China falling into a “middle-income trap”. The paper selects the perspective of income distribution, finding the income distribution brings challenges to go into "Middle-income trap " through consumer demand, fiscal policy, innovation and productivity, social contradictions and so on. If the China wants to successfully cross the "middle-income trap", the roots are to improve the income distribution gap. Through the empirical, we know that income distribution inequality and the "middle-income trap" have a long-term equilibrium relationship. The income distribution inequality is play a promoting effect on economic growth, but through panel date of the east central region and west, the promoting effect has already begun to slow, basically presents approximate "inverted U".because of the limitations of data and ability limited, this paper cannot draw the "inverted U" tipping point. The East region relative to the Central and West region of the income distribution gap is not so big, it can jump "middle-income trap"; And central regions is able to cross in accordance with the standards of the past, but it does not exist the possibility of the latest standard in 2014; because of the income distribution disparity, the west is unable to cross the "middle-income trap". So, in order to avoid falling into the "middle-income trap", first, China needs to narrow the gap in income distribution, especially in the central and west of the income gap. Second, China should be sustainability develop economy to across the "middle-income trap". In order to help the central and west smoothly across the "middle-income trap", China need to promote the urbanization process scientifically, improve the quality of urbanization; enhance investment in education, improve the quality of the laborers in the central and west; improve the consumption structure and level; steal coordinated development of industry as a whole.