The Influence Of Industrial Agglomeration On China's Urban-Rural Income Gap

Government reports have attached great importance to the balanced development of urban and rural areas and the issue of income distribution since the 15th National Congress of the Communist Party of China.In particular,with the proposal and implementation of the "targeted poverty alleviation",the efforts to improve the living standards of the backward rural residents and narrow the urban-rural income gap have been strengthened.The urban-rural income gap has been formed by some historical reasons,and the affecting factors are different at the different development stages.To understand the influencing factors and mechanisms of the income gap is helpful to improve the implementation of the policy.Besides the traditional factors such as urban-rural dual structure,fiscal decentralization,and economic development,industrial agglomeration and foreign direct investment are emerging factors that have recently been found to have a significant impact on the income gap.Moreover,industrial agglomeration and foreign capital are coincident in industry and spatial distribution in our country.The more obvious the concentration of industries,the more foreign capital they absorb.The higher the level of agglomeration,the more concentrated the foreign capital is.Therefore,it is unreasonable without considering the other factor.I introduces foreign direct investment stocks when studying the impact of industrial agglomeration on urban-rural income gap to improve and enrich the existing research.By constructing a dynamic GMM mediation panel regression model and using 364 panel data of 28 regions in China from 2004 to 2016,1 try to study that whether the industrial agglomeration can really affect the urban-rural income gap,and what the role of foreign direct investment during the process.I find that industrial agglomeration can narrow the income gap through the effects of wage growth,employment expansion and income distribution,based on the control of the economic development level,the number of educated people,the urbanization and the government finance.In the process,FDI plays a part of the intermediary effect.Therefore,in the key period of building a well-off society,all regions should rationally lay out local industries,guide the accumulation of related industries,and make full use of the intermediary effect of foreign direct investment.Only in this way,can we narrow the income gap furtherly and win the battle against poverty.