Research On The Impact Of Financial Development On Urban-rural Income Distribution In China

Since the reform and opening up,our country’s remarkable economic development has created a miracle of economic development,however,during the time that the GDP is rising,the urban-rural income distribution in China has widened.Common Prosperity is a great ideal,so narrowing the urban-rural income distribution in our country and improving the real income level of the general public is one of the core goals of the reform of my country’s income distribution system and even the reform of the entire economic system.Arrangement in two stages,in the first stage,"people’s life will be more affluent,the proportion of middle-income groups will be significantly increased,the gap between urban and rural development and the gap in living standards of residents will be significantly narrowed,the equalization of basic public services will be basically achieved,and all people will be"Common prosperity has taken solid steps";General Secretary Xi Jinping pointed out in his speech on August 17,2021 that "now,we have reached a historical stage of solid promotion of common prosperity",and this article is under this background to study the impact of financial development on urban and rural income distribution.This paper first introduces the relevant concepts and basic theories of financial development,and then uses the Gini coefficient method,Theil index method and other methods to measure the status quo of China’s urban and rural income distribution,and analyzes the status quo of China’s financial development from the aspects of economic monetization,financial development scale and efficiency.Then the relationship between financial development and urban and rural income distribution is theoretically analyzed from the perspectives of three kinds of effects,and a fixed effect model is used based on panel data of 31 provinces and cities of China that covers from 1997 to 2020.Finally,this paper draws conclusions and provides policy suggestions on the impact of financial development on the income distribution gap between urban and rural areas.This paper draws the following conclusions: the improvement of financial efficiency truly can narrow down the rban-rural income distribution,and the expansion of financial scale will widen the rban-rural income distribution.There is indeed a Kuznets effect between the gaps,but in general the hypothesis of an inverted "U"-shaped relationship between the two has not been robustly tested.On the basis of relevant research results,the policy recommendations put forward by this paper are as follows: 1.Continuously improve the efficiency of financial development,2 Reasonably expand the scale of rural finance,3Building a financial system with coordinated development,4 Make full use of the interaction between financial development and economic growth.