A Study Of The Influence Of China’s Inclusive Financial Development On Urban-Rural Income Gap

In recent years,China’s economy has undergone major changes,both in terms of economic growth and quality.However,China’s urban-rural dualization structure still exists,the distribution of financial resources is unbalanced,and the income gap between urban and rural residents has widened.The introduction of inclusive finance is to promote the fair allocation of China’s financial resources and help vulnerable groups enjoy financial services.Therefore,it is a brand-new idea to solve the problem of urban-rural income gap by developing inclusive finance.However,whether we can truly reduce the income gap between urban and rural residents requires us to test and prove.This paper explores the influence of inclusive financial development on urban-rural income disparity from two levels: theoretical research and empirical research.Theoretically,the influence of inclusive finance on urban and rural income gaps is achieved through two paths: one is the direct mechanism of financial services availability,and the other is the indirect mechanism of economic growth.The direct action mechanism includes the threshold effect of financial services,the non-equilibrium effect of financial services,and the poverty reduction effect of financial services.The indirect mechanism refers to the development of inclusive finance with economic growth as a transmission link,raising income levels by promoting economic development,and affecting income distribution;from empirical analysis,based on data from 31 provinces in China from 2008 to 2017,Taking the urban-rural income gap as the explanatory variable,the inclusive financial index is the explanatory index,the scientific indicator system composed of the government variables,the industrial structure,the urbanization level and the control variables represented by economic growth,and establishes the inclusive financial development and the urban-rural income gap.The static panel data model of the relationship,in order to be able to test whether China’s inclusive financial development level has a significant impact on narrowing the urban-rural income gap.The study found that the situation of China’s inclusive finance is not very optimistic,the overall development of the country is not high,and the regional development is quite different.In the more developed provinces,the greater the inclusive financial index,the higher the level of inclusive financial development.Inthe provinces where the economy is lagging behind,the smaller the inclusive financial index,the lower the development level of inclusive finance;in the long run,the development of inclusive finance and the income gap between urban and rural residents will be in a stable state.When we increase the development level of inclusive finance,the urban-rural income gap will shrink.This paper explores the specific impact of the development of inclusive finance in China on the urban-rural income gap and helps to understand the development of inclusive finance in China.From the perspective of inclusive finance,it gives some suggestions for alleviating the income gap between urban and rural areas in China,and provides policy recommendations for improving China’s urban-rural dual structure and coordinating urban and rural development.