Study Of The Impact Of Demographic Dividend On The Urban-rural Income Gap

Since the foundation of new China, it’s population structure has changed twice. Along with the change of population structure, a low dependency ratio and high labor participation rate have appeared in our country’s population age structure. According to Swedish population life table, which stipulated the demographic period, children under 14 years old are regarded as underage population and people at the age of 65 or over 65 are regarded as elderly population. In the population age structure, when total dependency ratio is less than 50%,the region goes into the demographic period. Since our country went into demographic period in 1993,the economy has been developing rapidly,but the income gap between urban and rural areas has been enlarged. Since 1993, the income gap between urban and rural residents has risen from 1665.8 yuan to 16648.14 yuan, the income ratio of urban and rural residents increased to 3.10 times from 2.80 times. For the sake of social harmony and stability, it is extremely urgent that urban and rural areas share the demographic dividend, and that the income gap between urban and rural areas should be narrowed.By studying the present related theory of demographic period and it’s concept, this paper puts forward theoretical hypothesis from the two significant characteristics of demographic dividend---high labor participation rate and decreasing total dependency ratio. According to theoretical hypothesis, VECM model is built by using the time series data of the total proportion of secondary and tertiary industry, the urban-rural human capital investment difference and the urban-rural income gap from 1993 to 2012 in China. The empirical results show that the change of industrial structure and the difference of urban-rural human capital investment all affect the urban-rural income gap. In the lag period, the increase of the total proportion of secondary and tertiary industry will narrow the gap between urban and rural areas while the expansion of urban-rural human capital investment difference will widen the income gap between urban and rural areas.Finally, in order to prove that the empirical results coincide with theoretical analysis, combining the two, should be in the demographic dividend period and so on, by optimizing the industrial structure upgrading transformation and reduce the urban and rural human capital investment difference to narrow the income gap between urban and rural areas in China. On this basis, combining with the national conditions, the following four relevant policy suggestions are put forward: increasing government support for agriculture and increasing farmers’ income level; eliminating the institutional obstacles and unifying urban and rural labor market; Speeding up the upgrading of industrial structure and developing labor-intensive industries; Increasing the rural human capital investment and improving labor productivity in the countryside.