The Impacts Of Inclusive Finance On Urban-Rural Residents’ Income Gap

After the reform and open policy, our country economy develop steadily, as the core of modern economy the financial industry has made remarkable progress. However, the intrinsic defects existing in the current financial system also exposed, the gap between rich and poor increase, small and medium-sized enterprise financing difficulties, serious problems such as regional financial development gap is widening, makes the call for the financial system needs reform has been constantly. At the same time, due to the prevalence of urban-rural dual structure, the influence of China’s current financial system is fragmented, financial resources, the configuration of the inequality, part of the regional finance present desertification, directly led to the widening of income gap between urban and rural areas in China. In order to solve these problems, the government was put forward the inclusive financial system in our country in recent years, hoping to expand the scope of financial service coverage, ensure that all people can enjoy safe and convenient financial services, so as to eliminate poverty, narrow the income gap between urban and rural areas, the purpose of promoting balanced economic growth between urban and rural areas.Under this background, the research in our country level of inclusive financial development on the influence of income gap between urban and rural areas, for our country to promote inclusive financial system construction, realize the coordinated development of urban and rural economy, to explore the effective measures to narrow the gap between urban and rural is of great significance.This paper expounds the inclusive financial system, on the basis of financial background and meaning, analyzes our country inclusive financial system and the present situation of the income gap between urban and rural areas and the influence mechanism, from the theoretical explore inclusive financial system whether financial development can change the status quo of the increase in the income gap between urban and rural areas in China. And then review the scholars to inclusive financial system index based on the research of the index system of financial development, using the Sarma (2008) to build inclusive financial development index calculation method, constructed by the availability of financial services, the usage of financial services, financial services quality of three dimension 13 indicators of inclusive financial development index, index system, and by using the index system to measure out of 31 provinces from 2006 to 2014 of the country’s inclusive financial development index. Results show that the inclusive financial development level in our country present increasing trend of western, central and east is higher than above.Secondly, this paper uses2006-2014 provincial panel data of 31 provinces panel is PVAR model, from the perspective of dynamic study inclusive financial development’s influence on the income gap between urban and rural areas, the quantitative measure regional level of inclusive financial development on the amplitude of the influence of income gap between urban and rural areas, and using the static panel model robustness test. The empirical results show that across the country, lag issue of inclusive financial development index of the income gap between urban and rural areas have a negative effect, namely the inclusive financial development speed boost to narrow the income gap between urban and rural areas, its narrow range in the western region is greater than the central region is greater than the eastern region, inclusive financial development on the influence of income gap between urban and rural areas in central and western time should also be significantly longer than the eastern region, in the western and central regions ascend inclusive financial development level significantly and continues to narrow the income gap between urban and rural areas.