An Empirical Research On The Relationship Of Jiangsu Province’s Labor Share And The Resident Income Gap

Since the reform and opening up, with the rapid development of the economic, the GDP of Jiangsu province in2011is ranked second in China, and has become one of the most developed provinces. While the total income of residents is increasing, the resident income gap is also increasing, it will seriously affect Jiangsu province to achieve the goal of the "two leadings". This article makes the labor share in GDP as the starting point, and research on the relationship of the labor share in GDP of Jiangsu province and the income gap of between urban and rural, this has practical significance on the more comprehensive grasp of the income distribution in Jiangsu province and narrowing the resident income gap.This paper first explained the related theory about labor share and income distribution, and summarized the current literatures. Secondly, analyzed the present situation of labor share and resident income gap of Jiangsu province from urban-rural, industry and region aspect. The results showed Jiangsu’s labor share is low, the urban-rural income gap is huge, and there is certain relevance between the two. Then, compared Jiangsu province with other provinces on the labor share and resident income gap. Thirdly, Use econometric model, taken control variables such as urbanization, industrial structure into account, and the long-term impact of labor share on urban-rural resident income gap is tested. The results showed that from the long-term trend, the labor share and the proportion of non-agricultural industries both have negative effect on the urban-rural income gap, while the urbanization level and the urban-rural income gap are positive related. The panel data model established on the other24provinces and cities also verified it’s universal significance that the labor share and urban-rural income gap are negative related. Finally some suggestions and policies are put forward based on the research.