Urban and Rural Income Gap: Does Urban Spatial Form Matter in China?

Abstract

This research uses satellite remote sensing data to measure the urban spatial form and analyzes the impact of changes to urban spatial structure on the income gap between urban and rural residents. The results indicate that the compactness of the urban spatial form is positively correlated with the income gap between urban and rural residents. However, there is no statistically significant relationship between the urban spatial extension rate and the urban–rural income gap. A subsequent analysis of the control variables shows that fiscal policy is positively correlated while urbanization is negatively correlated with the income gap between urban and rural residents. These conclusions provide the basis for formulating policies to narrow the urban–rural income gap. Appropriately reducing the spatial compactness of cities can narrow the income gap. In addition, changing excessive preferences for urban fiscal policy and increasing the level of urbanization can also promote a reduction in the income gap between urban and rural residents.