Macroeconomic Factors And The Income Gap

Income distribution is a major social problem, it is an important factor to affect the economic development and social stability and we can’t be simply viewed it as the economic balance of free competition and normal results. For over 30 years of reform and opening- up, the society and economy have changed a lot in china. For example, it not only the economic have developed rapidly, and also people’s living standards improve at the same time. However, the income distribution disparity of residents is also presents the increasing trend and appeared the phenomenon of "polarization", this will cause social and economy instability. At the present, residents widening income gap has become a hot issue in our social economy, it is our consensus to improve the income distribution.This paper uses the panel data of 27 countries on the macroeconomic factors affect the distribution of income has carried on the empirical a nalysis. Macroeconomic factors are economic growth, financial development, market, trade openness, and tax. The economic growth index is GDP per capita. The financial development index is Mc Intosh index(M2 accounted for the proportion of GDP). The degree of market measured by the index of economic freedom measures. Tax measured by tax accounted for the proportion of GDP said. Through the processing of a large number of statistical data, the panel data of 27 countries in 2000-2013 related indicators. Use the Eviews6.0 software to make the data unit root test and cointegration test, and then through the establishment of panel data model, using the section weighting generalized minimum two multiplication PCSE, the panel data regression, and has carried on the simple analysis of the results and the reasons.Group regression results show that, the direction of economic growth and financial development impact on different types of income national income gap is same. In low income countries, the relationship between the income gap and economic growth and financial development were positively correlated. In middle income countries, the inverted U relationship between the income gap and economic growth and financial development. In high income countries, both negatively correlated with income gap. The degree of market and the income gap between the three groups of coutries are positively correlated. The higher the degree of market, the larger the income gap. In low income countries, negative correlation between trade openness and income gap. In middle income countries, trade openness and income gap is U. In high income countries, trade openness and income gap is positively correlated. Negatively relationship between the tax accounted for the proportion of GDP and income gap in low income countries and middle income countries. In high income countries, the effect of tax on the income gap is not significant.Finally, on the basis of the empirical analysis, we put forward relevant policy and recommendations from economic growth, financial development, market-oriented, foreign trade and tax adjustment, respectively.