CORRELATION ANALYSIS OF CHANGES IN THE INCOMES BETWEEN URBAN AND RURAL CHINESE RESIDENTS AND THE DEVELOPMENT OF NEW URBANIZATION

摘要

Expanding income gap between urban and rural residents is an important issue in China's economic development.Urbanization is one of the important reasons that influence the income gap of residents.This paper attempts to exploit the time series data in Wuhan from 1985 to 2010 to establish a correlation indicator system that reflects the level of urbanization and the income gap between urban and rural residents.We also use the empirical analysis to find the dynamic link between urbanization and income gap.By the way, through unit root tests, we found the Theil index and the rate of urbanization is a single whole sequence.In further co-integration test, we also found that there is a cointegration relationship between the two varieties, which says there is a long-term equilibrium between the Theil index and the urbanization rate, therefore, it is necessary to build the error correction model to explore which impactions of the income gap between urban and rural residents would be lead by the short-term fluctuations of the urbanization rate.The results of this study indicate that the short-term model is not statistically significant and the relationship between short-term fluctuations in the rate of urbanization and the income gap between urban and rural residents is not remarkable.Thus, we propose the combination of policy recommendations to narrow the income gap and to push forward the construction of the new urbanization of Wuhan.