Urbanization, Opening Impact On Urban-rural Inequality

The main purpose of this paper is to explore the effect of urbanization andopening on the income gap between urban and rural areas, In recent years，China’surban and rural income gap has been widening，The widening income gap betweenurban and rural areas will lead to a series of social problems, It will affect socialharmony and stability, on the other hand, it’s not conducive to the sustainabledevelopment of economy, Different scholars have different opinions about the effectof urbanization and opening on the income gap between urban and rural areas. So thispaper selects31provincial-level administrative region of China about theurbanization rate and the level of opening up, The data was panel data come from2000to2011, The main purpose of this paper is to study the influence of urbanizationand the level of opening on the income gap between urban and rural areas, This articlemainly includes four parts.The first part mainly introduced the domestic and foreign scholars’s researchabout the effect of urbanization and the level of opening on the income gap betweenurban and rural areas, by means of combing the literature I found that differentresearchers using different methods and different intercepts data samples come toinconsistent conclusions.The second part introduced and analyzed Kuznets curve firstly, then IIntroduced Lewis dual structure theory and it’s development theory. In the study ofUrbanization Impact on the urban-rural income gap I explains the mechanism ofurbanization on the income gap which can Expand the urban-rural income gap andalso Narrowing the urban-rural income gap. At last I analysis the impact of openingup on the urban-rural income gap through Product prices, industry structure,competitive power structure, trade policy， Factor prices mechanism, demand,technological progress, labor market flexibility and so on. The results show that there are two opposing mechanisms, On the one hand opening widened the urban-ruralincome gap, on the other hand it will narrow the urban-rural income gap, but wecan’t figure out which effect is bigger.The third part describes the status of national and7regional urbanization,opening to the outside world and the urban-rural income gap, And then I compare thedifferences between them。The fourth part is the empirical analysis, Firstly establishing a panel data modelbetween urbanization and the urban-rural income gap and also opening to the outsideworld and the urban-rural income gap. The results showed that there are only19provinces of our country’s urbanization has significant effect on the income gapbetween urban and rural areas, Apart from Hebei, other18provinces urbanizationhave inhibitory effect on the urban-rural income gap. Tibet, Heilongjiang’surbanization maximum inhibitory effect on the urban-rural income From the elasticcoefficient. From different regions, the effect is not significant in Central area ofChina, The Influence of urbanization on the urban-rural income gap is not significantnorthwest, southwest, northeast. In opening up，it’s impact on the urban-rural incomegap isn’t significant among half of the provinces, Shaanxi, Henan, Tibet’s effect ismost significant, From7different regional perspective, opening effect is onlysignificant in north, northwest, southwest. The opening in the northwest widendedincome gap between urban and rural areas，but North China and southwest China hasinhibitory effect on the urban-rural income gap.Finally, on the basis of the above research I gave the conclusion, and relevantsuggestions.