A Research On Using Financial Management To Narrow The Income Gap Between Urban And Rural Areas’ Residents

Economy is the main focus of our country since the reform and opening-up,which makes the development speed of our country’s economy surprised the world andthe income level of people increase significantly. However, the income gap betweenurban and rural areas is becoming larger while the economy is developing fast. Thegrowth in every people’s living standard proves a country’s capability but not thegrowth in some people’s living standard. The income gap between urban and ruralareas’ residents restrict our country’s economy balanced development, which causesour country’s economy become more and more imbalanced, although our country’seconomy still develops in a high speed. Except that, gap of wealth become widen,which makes the rich become richer and the poor have less money. This problem isincreasing more and more serious in the recent years, the statistic data shows that theGini coefficient of our country reached0.479in2003, which outnumbers the worldwarning line, what’s more, it reached0.490in2008. If our country’s economy wants todevelop harmoniously, this serious situation should be solved immediately. In a senseof economy, this problem will disappear while the economy is increasing, but if onlydepending on its own development, it will take a long time to solve this problem. Itwill cause contradiction and break the harmony of society. Because of this situation,there are some economists have analyzed this problem and given some suggestions andcountermeasures through their own research perspective.This dissertation using the financial manage perspective to discuss and analyze, itincludes: Firstly, analyzes our country’s income of urban and rural areas and theincome gap between them by using the statistics. Secondly, using the economyperspective to unscramble the reason of this problem under the special condition of our country, and gives the suggestion by using financial management to solve this problem.Thirdly, evaluates and analyzes the successful financial management which is beenusing by the other developed country and developing country. Next, finds what couldbe used to solve our country’s problem by analyzing other country’s successful plan.Finally, according to our country’s condition, gives the feasible and effective financialmanagement on reducing income gap between our country’s urban and rural area’sresidents.1.Description of our country’s urban and rural area’s incomeStatistics show the main source of income and income gap of our country. Thisproblem has been a long time problem. The basic way is the difference of incomesource. Reduces the wage income gap and transitivity income gap is a main solution,and also should enhance the peasant’s operational income.2.The reason of income gap in our country—analyze on economy perspectiveOur country’s special condition decides the difference on financial systembetween rural and urban area. It includes: financial size is different, financialcompetitiveness is different, developing degree of financing institution is different, thedifferent distribution of financing institution, different financial innovation, differentmarket and different use ratio of capital market.3.Other country’s finical management and their enlightenmentDeveloped country and developing country adopt different measures depend ondifferent country’s condition. Finding measures that are suitable for our country byevaluating and analyzing their measures. Firstly, establishing rural finance servicesystems depend on our country’s condition. Secondly, enacting low to guarantee thedevelopment of rural finance. Next, rural development bank provides concessionalcredit to peasant. Finally, completing our country’s agricultural insurance system.4.Countermeasure on reducing income gap of our country—on finical perspectiveProvides countermeasure to reduce income gap of our country on finicalperspective. Firstly, improving our country’s fiscal policy. Secondly, completing ruralarea’s credit policy of our country. Next, promoting the development and establish of rural informal financing institution. Finally, completing rural financial system.