An Empirical Analysis Of The Relationship Between Income Distribution Gap And Economic Growth

The relationship between income distribution and economic growth has been one of the high degree of focus, in the research areas of economics controversial issue. But so far the relationship between an economic growth and income distribution what has not been given a satisfactory explanation about realistic data, So there is not be able to provide targeted and effective solution to the problem of policy ideas for the conflict and contradiction between income distribution and economic condition.Therefore it is necessary in accordance with the actual economic conditions and environmental changes and the use of rigorous research methods and scientific ways of thinking to do on this issue in-depth analysis and discussion system.Since the reform and opening up, Chinese income distribution system residents conducted a series of in-depth changes from "distribution according to work is dominant and a variety of modes of distribution is coexist" the income distribution gradually replaced the extreme egalitarianism under the planned economic system revenue distribution. Income distribution system which after reform breaked the basic pattern which is the income distribution of extreme egalitarianism, which greatly inspired the masses of labor enthusiasm, prompting rapid economic growth, but the Chinese income gap has continued to increase. The growing of income gap, which caused negative effects about increased of the economic and development of social in the community has attracted wide attention.After carding domestic and foreign related research in this paper, the relationship between income distribution and economic growth is analyzed in theory, then we found the relationship that both promote each other, influence each other and restrict each other dynamic relations of organic. At the same time, contact the theory with practice, first, objective analysis about our residents income distribution for the objective description; next, made empirical analysis about the relationship between China income distribution gap and the economic growth. What is the relationship between China residents income distribution gap and economic growth? The author analysises the relationship about China income gap (as measured by the GINI coefficient) and economic growth (in1978the GDP to calculate the GDP index) base conduct stationarity test, cointegration relationship test and granger causality test, and then set up ECM model, then found that the causal relationship between income gap and economic growth then made the impulse response function analysis.The empirical analysis concludes:the income gap and economic growth in China, there is a cointegration relationship between the co-integration relationship for further verification, the cointegration relationship between the income gap and economic growth is a two-way causality. In general, the relationship of income gap and economic growth has two characteristics:one is the influence of income gap on economic growth is to promote before. Early stage of economic development needs expanding income gap to arouse the enthusiasm of people to create wealth, thereby promoting economic growth, along with economic development, the increase of residents’ income gap on economic growth will instead have inhibition; Secondly, the economic growth effect on the improvement of the income distribution gap weaker than enlargement effect. So on the basis of the analysis of the above theoretical analysis, combined with the current actual situation in our country, put forward to improve the relation between economic growth and income distribution in our country related policy suggestions.