Study On Financial Development And The Income Gap Between Urban And Rural In Guizhou Province

Since China’s reform and opening, the urban-rural income gap is gradually expanding. The latest statistics-report shows that our country’s Gini of income has reached 0.469, incoming gap is greater. At present, our country pay more attention on solving the problem of agriculture, increasing farmers’ income and narrowing the urban and rural income gap, ensuring fast and good development of economy.There are three viewpoints on the financial impact of the income gap between rural and urban development. First, financial development can narrow the income gap between urban and rural areas; the second is the financial development will widen the income gap between urban and rural areas; the third is an inverted U-shaped relationship between financial development and income gap between urban and rural areas. Mainly due to threshold effects, exclusion effect, reduce storm effects, non-equilibrium effects and the trickle-down effect.This article selected Guizhou’s data from 1978 to 2013, studying the relationship between financial development and the income gap between urban and rural. The views of my analysis are financial scale has increased the income gap between urban and rural areas, and financial efficiency has narrowed the income gap.