The Dynamic Research On The Income Gap Of Urban Residents In The Process Of Urbanization

Since the economic reform and opening up of policy, with the deepening of China’s market-oriented reform, industrial restructuring become more rational, and the financial market system improve constantly, diverse forms of ownership to achieve rapidly developments and urbanization has improved continuously, which prompting China’s economy has made considerable progress and huge development, people’s income levels have been significantly improved. At the same time, urbanization is accelerating in China with a large population of rural-urban migration, Meanwhile in terms of basic social security system, financial markets, market economy system and the construction of the income distribution system can’t meet the needs of economic development, which leading the income gap between the inter-urban and rural residents, rural residents and urban residents was also gradually expanding, and affects social stability and harmony.This article focuses on changes in urban income gap and tried to reveal the basis of its own law of development of China’s urbanization on the discussion of the income gap between urban development and urbanization, the impact of changes in the mechanism on how to maintain the income gap between urban residents corresponding countermeasures and suggestions put forward within a reasonable range. This article builds on the academic study of existing research results which have been studied by economists in the issue. First, Economists summarizes the research results, and then through the existed research results which have been summarized and analyzed to find out the direction and breakthrough point of this paper. This study focuses on the following issues:First, by quoting the development of urbanization development quality measurement system which was constructed by economists, and then to establish an Indicator System which includes the proportion of urban population factors, the level of the urban economy, public service facilities and social security system to measure urbanization development quality, and as comprehensive as possible to make it Scientific.Second, The article summarizes and use calculation of the stocked Gini index which has been proposed by scholars and has been excluded the impact of consumption to measure the income inequality levels, and which can match with the actual income level well and reducing the bias between the Gini index and he income inequality levels.Meanwhile, we collect the time-series data from the "China Statistical Yearbook(1996-2013)",and use the income levels empirical data and the urbanization development quality data which calculated from urbanization development quality measurement system. And then analysis of the characteristics and trends of urbanization of China’s development since1995, and studying the trends and characteristics of the stock of Gini index for Chinese urban residents. Through the researches, the article found that between the urbanization of China and the income gap in urban residents has the characteristics of Convergence changes, so the two have some possible existence of a relationship.Again, the article selects economic growth, financial development, industrial development and urban differences the relationship between urbanization as the mediating variables to get qualitative analysis between the urbanization and the income gap of urban residents. First, we need to study the relationship between the mediating variables and the urbanization of China, and then to get the relationship between the mediating variables and the income gap of urban residents. Finally, we can successfully describe the internal mechanism of which urbanization on the income gap urban residents.Finally, this paper depends on earlier theoretical analysis findings, and selects the variables and process the data. Then we rely on Stationary test, AR root test, Granger causality test of time series data to determine the final variable of VAR model. And then, take the output of VAR pulse response function, Variance decomposition model and VAR model to research the relationship between the income gap of urban residents and the mediating variables which includes economic development, financial development, binary structures and Industry differences, and get the study of the impact of urbanization on the income gap. Through empirical analysis, this paper found that both Granger causality test and impulse response function and VAR model outputs show that the increasing urbanization level has a significant inhibitory effect on the urban residents’ income gap of china and it is statistically. Therefore, adherence to the local conditions, effectively using the advantage of area resources, choosing a healthy urbanization patterns persist, driving the industrialization, urbanization and services virtuous cycle in the virtuous cycles. And then, relying on the economic role of the market to achieve effective industrial division and social division of refinement to enhance the ability to stimulate the economy of urbanization, and improve the income level of residents, effectively to promote the urban residents’ income gaps in a reasonable range. Secondly, the preceded stocked Gini index shows a significant expansion of the role to the current stocked Gini index which on behalf of the urban residents’ income gaps. So we are necessary to prevent the " Threshold Effects " or the "Matthew Effect" which may cause "the poor are more poorer, the rich are more richer," and preventing the low-income caused by inertia poverty, high income caused by wealth inertial growth, finally effectively inhibit the income gap. Once again, with the GDP increasing faster and the growing supply of public goods will have significant impact on the urban resident income gap. So we need to develop the urban economy by getting the guidance of labor mobility effective, increase the factor inputs, upgrading industrial structure and promote the financial market development of city, finally improve the average income of residents.Meanwhile, the government has to improve ability of public goods supply for people, especially for low-income residents, to provide a good social security environment. The government needs to improve residents’ employability by offer basic education and vocational skills education, to rapidly increase the income level of low-income people, effectively inhibit widening income gap. Also, the study also found that the factors of financial development, the dual economic structure and development of the industry differences have a significant effect on the changes in China’s urban Residents income gap. So in the process of urbanization, we need to continue to develop the financial markets, and proved an equity financial environment for low-income people, enhance the proportion of low-income revenue from property. Finally, according to the actual situation of China’s economic development stage, and gradually establish a suitably income distribution system for current income level, continue to regulate unreasonable income distribution, effectively regulate excessively high incomes and ban illegal income, and alleviate the expanded income gap in the urban residents, maintain social stability.