The Region Heterogeneity Research On The Financial Development Effection Of The Income Gap Between The Urban And Rural Areas

From the reform opening,the finance promoted rapid development,has already became the core of the market economy in modern times,with the development of economy,The financial industry in the contemporary economic and social life plays a more and more important role,it influences not only economic growth,but also distribution of social wealth,which has a potential effect on the income gap between urban and rural areas in China.In recent years,China's financial industry has made great progress as well as the economy,at the same time,the gap between urban and rural areas in China is gradually expanding,"Polarized" problem has become increasingly apparent,which affects the stability of the society and national economy seriously,in the long run it will eventually become detrimental to the sustainable and healthy development of economy,this issue has aroused wide concern.Can financial development play a role in narrowing the income gap between urban and rural areas? Is there anything different on the impact of financial development between the eastern,central and western regions in urban and rural areas in China? In recent years,the academic research on this topic is becoming more and more hot,making it a hotspot of academy.This paper mainly explores the financial development of regional heterogeneity influence on the income gap between urban and rural areas,Whether financial development affect the income gap between urban and rural areas in China or not,how does financial development influence the income gap between the eastern,central and western regions in urban and rural areas in China differently? In this paper,the research process is as follows: First review and summarize predecessors' results on this issue,and then describe the reality of the financial development and urban-rural income gap of our country.From the two dimensions of theoretical basis and path analysis to explore the impact of financial development to our country the income gap between urban and rural areas Then entered into the phase of the empirical analysis,through the modeling analysis,we know how did financial development factors and other related factors influence the income gap between urban and rural areas in China,and then analyzes the formation mechanism of regional heterogeneity.In the experiment part,provincial panel data from1994 to 2014 are adopted to test the relationship between financial development and urban-rural income inequality.The paper applied the Dynamic Panel GMM Estimators in Stata to study empirically the inner relationship between financial development andurban-rural income gap as well as the regional heterogeneity.The results showed that the impaction on the financial efficiency of urban-rural income gap is significantly negative and different: the effection is most significant in the Central Region,the Western Region follows,the Eastern Region is the least significant.The effection of the financial scale in the Central Region is significantly positive,but no significant impaction on the Eastern and Western areas.According to the research conclusion,the paper put forward the relevant suggestions which targete to benefit the public as well as narrow the income gap between the urban and rural areas.