Comparative Analysis Of The Impact Of Traditional Inclusive Finance And Digital Inclusive Finance On The Income Gap Between Urban And Rural Areas

The large income gap between urban and rural areas has been a problem that Gansu Province has been working to solve for a long time.In 2020,the overall victory in the fight against poverty means that Gansu Province has eliminated absolute poverty,and the urban-rural income gap has also been significantly improved.However,the existence of relative poverty and other problems makes the urban-rural income gap in Gansu Province still high,and the problem is still serious.Practices such as poverty alleviation have proved that inclusive finance can effectively mitigate financial constraints faced by rural residents and poor groups in accessing financial services and products such as credit,and play an important role in eliminating absolute poverty and reducing the urban-rural income gap.At present,there are two kinds of inclusive finance models in China.First,the traditional inclusive finance,which focuses on offline financial services,has made great contributions to poverty alleviation and the improvement of urban-rural income gap in the past decade or so.However,in recent years,due to the impact of high costs,its effect has gradually weakened.Second,digital inclusive finance,which focuses on online services,can better reach and serve every target with the advantages of the Internet.At present,traditional inclusive finance and digital inclusive finance affect the urban-rural income gap in Gansu Province at the same time,and the difference in their impact effects determines that they may have different development prospects in the future.Therefore,a comparative study of the differences in the impact of the two on the urban-rural income gap in Gansu Province,and based on this,put forward relevant suggestions on the coordinated development of traditional inclusive finance and digital inclusive finance in Gansu Province,will be of great significance to effectively solve the urban-rural income gap in Gansu Province.However,the existing literature lacks a comparison of the effects of the two on the urban-rural income gap,and there are few empirical studies on the impact of inclusive finance on the urban-rural income gap at the county level.In this regard,this paper supplements it with the following research: First,on the basis of literature review,this paper makes an in-depth analysis of the development status of traditional inclusive finance and digital inclusive finance in Gansu Province.Secondly,based on the relevant theory of inclusive finance affecting the urban-rural income gap,this paper analyzes the relevant mechanism,and puts forward research hypotheses in combination with the current situation of inclusive finance development in Gansu Province.Finally,based on the panel data of 73 districts and counties in Gansu Province from 2016 to 2020,this paper uses the two-way fixed effect model to compare the impact differences of the two at the overall,sub-district and sub-dimension levels,and tests the "inverted U-shaped" effect.Research conclusions include:(1)Traditional inclusive finance development of traditional inclusive finance in Gansu Province has entered a relatively stable stage,and the differences between districts and counties are large,while the development of digital inclusive finance still has large space and the differences between districts and counties are small.(2)Both Traditional vs.Digital inclusive finance inclusive finance have a "positive U-shaped" effect on the urban-rural income gap in Gansu Province.(3)On the whole,the traditional inclusive finance plays a better role in reducing the urban-rural income gap in Gansu Province,while the digital inclusive finance and its depth of use and degree of digitalization in its three-dimensional dimensions fail to show its role in reducing the urban-rural income gap.(4)At the district and county level,both traditional and digital inclusive finance can no longer effectively reduce the urban-rural income gap;In ethnic counties,development of both inclusive finance has lagged behind.Traditional inclusive finance has failed to effectively reduce the urban-rural income gap,while digital inclusive finance has gradually shown its role in reducing the urban-rural income gap by virtue of its own advantages;In ordinary counties,compared with the significant expansion role of digital inclusive finance,the reduction role of traditional inclusive finance is better.Based on the empirical results,this paper believes that Gansu Province should strengthen the construction of mutual network and financial infrastructure,increase the publicity and promotion and education of inclusive financial knowledge in rural areas focus on developing digital inclusive services,and continue to improve traditional inclusive finance,encourage the diversified development of inclusive financial products and services,and guide financial institutions to close to digital inclusive finance.