The Influence Of Financial Transfer Payment On Income Gap Between Urban And Rural Areas

In the past 40 years of reform and opening up policy,China's economy has grown rapidly for a long time,forming a unique Chinese development model.Under the new situation of stabilizing the national economy and deepening the adjustment of traditional industrial structure,the income of the national residents has achieved rapid growth and the pattern of macro-income distribution has further improved.However,there is always an imbalance between urban and rural areas and uneven regional development.The gap between urban and rural residents in China is still widening.China's urban-rural income ratio has been above 2.7 since 2016.Appropriate gaps can bring motivation and innovation,but the excessive gap not only affects the sustained and healthy economic growth but also does not contribute to social stability and harmony.To promote the development of China harmoniously and healthily,we must solve the problem of the disproportionate income gap between urban and rural areas.The government improves the transfer payment system and plays its role fully in regulating income distribution,which not only promotes regional equalization,narrows the income gap between urban and rural areas but also achieves the development of urban and rural in harmoniously.During the 13 th Five-Year Plan,China has transferred from a middle-income country to a high-income country.However,China's huge urban-rural income gap will hinder China's progress today.It is essential to narrow the urban-rural gap.So this paper focuses on the impact mechanism of transfer payment on urban-rural income gap.It also examines the impact of a tax rebate,general transfer payment and special transfer payment on urban-rural income gap.Among them,general transfer payment can effectively narrow the income gap between urban and rural areas,but the tax rebate has a negative adjustment effect on the urban-rural income gap.In order to clarify the impact of transfer payments on the urban-rural income gap better,this paper uses the urban-rural income ratio and the Theil index to measure the urban-rural income gap and describes the trend of the urban-rural income gap.Secondly,through the panel model,this paper empirically analyzes the influence of fiscal transfer payment on the urban-rural income gap between 2007 and 2017 in China.In addition to taking 2013 as the time node,it also divides all provinces in China into three regions according to thecomprehensive economic strength.In short,this paper studies the impact of fiscal transfer payments on urban and rural income gaps over two periods and three regions.The empirical analysis draws the following conclusions:(1)Fiscal transfer payments have reversed the urban-rural income gap in the last ten years.(2)The redistribution effect of transfer payments becomes more significant over time.(3)The more the economy develops,the worse the redistribution effect of net transfer payments has.In general,China's transfer payment system reform has achieved certain results in the past five years,the transfer payment structure has been further optimized,and China's financial support for economically underdeveloped regions has yielded results.However,the overall effect of China's transfer payment to adjust the urban-rural income gap is not significant.We should keep on deepen the reform of the transfer payment system and combine it with policies that promote urbanization rate,industrial structure upgrading,education expenditure structure optimization,and social security enhancement.Take the value of the redistribution effect of fiscal transfer payments,narrow the income gap between urban and rural areas,and make a fair and reasonable distribution pattern as soon as possible.