The Study Of Financial Cause And Impact On Widening Income Gap Between Chinese Urban And Rural Area

Reform and opening up over the past thirty years, Chinese economy has rapidly increased. As of 2015, Chinese total economy ranked the second in the world. With the gradual improvement of China's economic strength, the income level of residents has been significantly improved, but the urban-rural income gap has become more and more obvious, which has become one of the main contradictions in China's social and economic development.The reasons for the expansion of the income gap between urban and rural areas have been concerned by the academic circles.Scholars from different angle analysis of the causes of the income gap between urban and rural residents. The causes can be roughly summed up their economic differences, the household registration system,urbanization, financial function and financial investment.From the perspective of finance as the core of economic development, financial factors impact on the income distribution research become a hot academic study. The results show that Chinese "two economic structure" particularity makes urban and rural financial development difference, the different of financial development is an important cause of increasing income gap between urban and rural areas. Therefore, the effect of the urban and rural financial development imbalance of income gap between urban and rural areas, trying to find the mechanism of financial non-balanced development of income gap between urban and rural areas, to provide a reference for effectively curb the expansion of income gap between urban and rural areas in China.First of all, this paper describes the theory of financial development, the introduction of domestic and foreign scholars on the financial development and income distribution. Secondly, it summarizes the role of financial development in the distribution of income, and then sort out the impact mechanism of the unbalanced development of financial income gap between urban and rural areas. Then, it summarizes the actual situation of the unbalanced development in urban and rural finance in China, and analyzes the influence of the difference between urban and rural financial development on income distribution. Again, select 2005-2014 Chinese provincial data combined with the provincial panel data model,to verify whether thefinancial imbalance is the cause of the increase in the income gap between urban and rural areas. The empirical results finally come to the scale of the financial development and the efficiency of the non-balanced income gap between urban and rural areas increased. According to the results, the paper concludes that the financial non-balanced development is the financial reason for the expansion of the income gap between urban and rural areas, and puts forward the countermeasures and suggestions to promote the balanced development of urban and rural finance and narrow the income gap between urban and rural areas.