Regional Income disparity and Its Changes Reasurs in Economic Development

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This is a comparive study on the current development, the background and significance of income distribution between China and Japan.We have found the following factors throught our research. On China, our study shows that income distributions, including nationwide, urban-rural and inter-reginions, have worsened since the start of China's economic reform. The main reasons caused the disparity are, 1) the priority policies for urbanreform and coastal area development since 1985 ; 2) the relative differentials of urban-rural labor productivity ; 3) the unballanced growth of rural industries among regions. The disparityenerated unsatisfaction of farmers, stimulated nationalist controdiction, and made some regions intend to independant from central government both economicly and politicly. These factors, in return, have big effects on China's future economic development and social and political instability. On Japan, our study shows that income disparity, especially urban-rural income disp … More arity had been so large that it caused the farmers' diputes, social instability and also, directly or indirectly, generated Japanese militorism in the period of pre-war Japan. We also found that the development of rural industry, contributed greatly to absorbt rural surplus labor, increase farmers' income and then, reduced income disparity in Japan.We got the following conclusions from the above studies. 1) the land reform, the dismision of family financial group, economic demogracy, institutional reforms and government policies, plaied very important role in income equlization in the period of post-war Japan. Japan's experience is inlightment to China on improving income distribution in recnetly. 2) the development of rural industry, the absorbtion of surplus labor contributed greally to the increase of farmer's income and reduceing income disparity in the post-war Japan. Therefore, we think that the development of rural industry, the free labor migration and rapid urbanization are needed to reduce the income disparity in China. 3) The worsening of income editributionin and the relative socialand political instability in current China is similar to the situation in pre-war Japan. According to the experience of Japan, we suggest China take some imediat policies to reduce the disparity so as to maintain social and political stability, and then to promote its sustained economic growth in the future. Less