Financial Deepening Our Relationship With The Urban-rural Income Gap Study

After more than30years of reform and opening up,China’s economic development made great achievements,the overall level of our social economy had made significant improvement,the GDP and per GDP also had greatly improved.Along with the huge improvement of the overall level of our social economy,people’s life and income level also fundamental improved.But at the same time, China’s urban and rural residents income gap is widening,and this problem is more and more serious.The problem has become a seriously factor restricting the development of China’s economy.If it cannot be solved well,it will become the important obstacle of China’s reform and development.While in the economy,finance is the core of the allocation of resources,it plays an important role on income distribution.The research of financial deepening, especially rural financial deepening has special significance.Therefore,this paper has carried out related research to analyze the relationship between financial deepening and the urban-rural income gap,and resolve the problem of large income gap between urban and rural areas.Based on the concept of financial deepening and the connotation of urban-rural income gap,this paper analyzed the present situation of financial deepening in our country from the three dimensions of total financial assets,financial asset structure, and financial asset allocation efficiency.This paper also analyzed the the present situation of the urban-rural income gap in China from the Gini coefficient,absolute income gap and income inequality index.Taking the ratio of M2and GDP,the ratio of financial institutions loan balance and GDP,the ratio of the financial institutions loans and deposits,the ratio of the agricultural loans and financial institutions loans as the independent variables,taking urban-rural income inequality index as the dependent variable,I set up a linear regression model.Through the model,I found that there existed a positive correlation between the first independent variable and the urban-rural income Gap,the coefficient was1.901938.There also existed a positive correlation between the second independent variable and the urban-rural income Gap,the coefficient was 1.887650.While there existed a negative correlation between the fourth independent variable and the urban-rural income Gap,the coefficient was-3.155390.But the correlation between the third independent variable and the urban-rural income Gap was non-significant.This paper summed up and summarized the causes of the excessive urban-rural income gap in our country.There is lacking of rural capital allocation.Financial institutions do not play its functions well.The rural financial market lacks of effective competition mechanism.The rural financial innovation ability is insufficient.The rural township enterprises lack of financial capital support.The rural insurance market is not developed,and so on.For the above problems,I put forward the countermeasures and the suggestions to narrow the urban-rural income Gap.Including,speeding up the rural financial development,perfecting the financial system construction,improving the efficiency of financial institutions,preventing the rural capital outflow,broadening the township enterprises financing channels,speeding up the rural insurance market development, and so on.