Impact Study Of Policy Changes On Residents’ Income Gap In China After Joining WTO

Income inequality has always been the concern of all countries. With China participating in the WTO, the free international trade is developing further, which do not only bring the rapidly development to the economy, but also enlarge regional income gap. This article is to measure the income gap of urban-rural, system of ownership, three industries and subdivision industries from four aspects, including the whole nation, provincial, three regional and among three regions, based on the30provincial panel data from1985to2012, and make use of the Propensity Score Weighting and Difference-In-Difference model to evaluate the effect that the WTO policy bring to regional income gap in China.The results show that:(1) The combined effects from the WTO policies and the Western Development policies make the income gap between urban and rural areas of the whole nation to expand26%, the industry gap enlarged by34%.(2)The WTO policies make the greatest effect to the residents’income gap in the eastern region, the income gap between urban and rural areas enlarged by164%, the effects of the polices continued for eight years; the industry gap enlarged by162%and the policies effects continued for ten years.(3)The WTO policies make the least impact on the residents’ income gap in the central region, just lead the income gap between urban and rural areas to expand18%and the effects of that continued for four years; the industry gap reduced by34%and the policies effects continued for two years.(4)The WTO policies make the income gap between urban and rural areas in the western region reduced by71%, lead the industry gap enlarged by15%, the effects to income gap of both urban and rural areas and industry continued for six years.The article makes a political proposal to reduce the income gap of different regions from three aspects, like as "the starting point, the course and the result". First, the starting point should be kept equal in public infrastructure investment; Second, speed up the economic development process, improve industrial structure, reduce the state-owned monopoly enterprises during the course; Third, make the relevant legal system and tax policy perfect in the result.