The Effect Of Unbalanced Financial Resources On Urban-Rural Income Gap In Henan

Income gap between urban and rural areas has been aroused highly attention from all sectors of society,urban and rural income gap enlargement will bring social conflicts intensified,public security environment confusion,and may also affect the comprehensive and sustainable development of economy in our country, therefore, how to narrow the income gap between urban and rural areas has become an important problem. Financial resources allocation has an important influence on the income. In our country, financial resources allocation has the characteristic such as tend to cities and scale. There has greater differences between urban and rural financial resources, it will inevitably affect the income gap between urban and rural residents. In this paper, we will study how to reasonable allocate financial resources between urban and rural areas to narrow the income gap between urban and rural areas.In this paper, we first analyzed the research status at home and abroad, about the financial resources allocation of the influence of income gap between urban and rural areas, then we analyzed some theories about them, after that we also analyzed the current situation about financial resources allocation and the income gap between urban and rural areas in Henan province. Know about that, we can continue to analyze the mechanism of financial resource allocation affects the income gap between urban and rural areas, we toke Henan province as an example to empirical test this mechanism, The results show that the unbalanced allocation of financial resources in Henan province expanded the income gap of urban and rural residents.According to the results of theoretical and empirical analysis, we put forward four policy suggestions to reshape the rural financial market and narrow the income gap between urban and rural areas. The first is to strengthen the relevant system construction, create a good rural financial ecological environment; The second is to ease market access, and establish a broad and diversified rural financial system; The third is to innovate the rural financial products, to cater to the need of farmers’ production and life; The fourth is to perfect rural finance related laws and regulations, strengthen the supervision and management of rural financial institutions.