The Research For The Relationship Of Corruption And The Income Gap Of Urban Residents

Corruption as an important source of abnormal or gray income has always been considered as a major reason for the widening income gap between urban residents in China. Many scholars(such as Li,Xu and Zou)found that there was a kind of inverted U relationship between corruption and the income gap ,that's to say, with the increasing corruption, the income gap increases first then reduces. This text further build a theoretical model by adding a more realistic condition that there is a kind of income gap in the initial society (Gini is not 0), and predicts that there is a positive correlation between corruption and the income gap of urban residents, then verity it by some data. Then this text analyzes the difficulties of econometric research with the Chinese data, and also predicts that if do it, the results will show that there is no relative or negative relationship between the corruption and the Gini index of urban residents. At the same time, the text proves it by the collected data about 31 provinces from 2001 to 2005.The results is very similar with the prediction. Finally the text provides some suggestion about preventing corruption and reducing the income gap between urban residents.