The greatest potential for increasing farmers' income lies in institutional fairness.

In 2013, the growth of farmers' income across the country achieved "ten-company fast", which is another solid step towards achieving the goal of doubling income set by the 18th CPC National Congress. However, at present, the problem of excessive income gap between urban and rural residents has not been reversed, the problem of income imbalance in rural areas has become increasingly prominent, and the long-term mechanism for increasing farmers' income has not yet been established. From the perspective of the channels for increasing farmers' income in the future, the growth space of household operating income is becoming more and more limited, the growth rate of wage income is declining, and the growth potential of property and transfer income is the greatest. At the present stage, in order to achieve the rapid growth of farmers' income, we must make efforts on system innovation and completely eliminate the problem of institutional unfairness under the dual structure of urban and rural areas.

The "four gaps" of Farmers' income

Since 2004, farmers' income has got rid of the continuous hovering situation. The per capita net income of farmers increased from 2622 yuan in 2003 to 8896 yuan in 2013, with an average annual real growth rate of 8.9 percent, far exceeding the average annual growth rate of 4.7 percent in the previous decade. But behind this, the imbalance of income distribution covered by averages has become increasingly prominent.

First, the absolute income gap between urban and rural residents continues to widen. The absolute income gap between urban and rural residents rose from 6486 yuan in 2004 to 18059 yuan in 2013, a record high. The more underdeveloped the economy is, the greater the income gap between urban and rural residents is. In 2013, the income ratio of urban and rural residents in Beijing and Shanghai was 2.20 and 2.28 respectively, while that in Gansu and Guizhou was as high as 3.71 and 3.80 respectively. In 2013, the per capita disposable income of urban residents is 3.03 times of the per capita net income of farmers. If all the per capita disposable income is compared, the relative income gap between urban and rural residents will be even larger.

Second, the income gap of farmers between regions is gradually widening. In recent years, the absolute gap between underdeveloped areas and developed areas continues to expand. In 2004, the relative gap of per capita net income between the highest Shanghai and the lowest Gansu Province was 4.17 times, and the absolute gap was 6268 yuan; in 2013, the relative gap between them decreased to 3.76 times, but the absolute gap widened to 14100 yuan.

Third, the income gap within rural areas is becoming increasingly obvious. With the deepening of rural market-oriented reform and the deepening of farmers' division of labor, the income gap between farmers is also gradually expanding. In 2013, 60% of farmers' income did not reach the national average, and the per capita net income of 20% of low-income farmers was only about 12% of that of 20% of high-income farmers. The Gini coefficient of per capita net income of rural residents has shown an overall upward trend since 2000, reaching 0.3857 in 2013, an increase of 0.0321 over 2000 and approaching the warning line of 0.4.

Fourth, the income gap between farmers' industries is becoming increasingly prominent. Judging from the changing trend of the main sources of income in recent years, the contribution of agriculture to the increase of farmers' income continues to decline, while the contribution of wage income to the increase of farmers' income increases rapidly. From 2004 to 2013, the proportion of agricultural income in farmers' per capita net income continued to decline from 47.6% to 31.8%, and the contribution rate of income increase decreased from 64.4% to 10.8%. The proportion of wage income in farmers' per capita net income increased from 34.0% to 45.2%, and the contribution rate of income increase increased from 25.5% to 58.9%. The problem of increasing the income of farmers, especially grain farmers, will become more and more prominent.

Under the influence of resource endowment, development opportunities, personal ability and other factors, it is normal to have a certain income gap, but if the income gap is too large, especially if it continues to expand in the long run, it must be paid great attention to. The income of farmers in China has been much lower than that of urban residents for more than 30 years, which is rare in the world. At present, China's per capita GDP has reached 6700 US dollars, which has entered the ranks of middle-income countries, but the Gini coefficient has also reached 0.473, much higher than the warning line of 0.4. In order to successfully overcome the "middle-income trap", we should pay more attention to the fairness of development, seize the opportunity to promote farmers' income growth and narrow the income gap between urban and rural areas.

Analysis on the potential of increasing Farmers' income

Since the reform and opening up, the channels for increasing farmers' income have gradually diversified, which provides a more solid foundation for promoting the increase of farmers' income. In the new stage, with the change of external environmental conditions, the role of different channels in increasing income has also changed greatly, and the pattern of increasing farmers' income has reached an important point of active adjustment.

The room for the growth of household operating income has narrowed. In 2013, the proportion of net income of farmers' household operation has dropped to 42.6%, of which the income of the primary industry accounts for 3top 4. Agricultural income plays a decisive role in the growth of household operating income, while the contribution of agriculture to the increase of farmers' income has tended to be weakened. The increase in the market price of agricultural products will still be limited, and the effect of price increase on farmers' income will tend to be weakened.

The growth of wage income is more limited in the short term. At present, China's potential economic growth rate is down, and steady growth is gradually becoming the norm. Economic growth has slowed steadily in recent years, falling below double digits in 2011, 7.8 per cent in 2012 and 7.7 per cent in 2013. The growth rate of the average monthly income of migrant workers has also dropped from about 20% in 2010 and 2011 to less than 14% in the past two years. It is optimistically estimated that the growth rate can be maintained at about 10% in the coming period, which is much lower than the previous level.

There is a lot of room for growth in transfer income and property income. Since 2004, the national policy of strengthening farmers and benefiting farmers and rich farmers has been introduced intensively, and a series of subsidy policies with high gold content have been put into practice. the absolute amount of transfer income and the proportion of farmers' per capita net income have increased rapidly, which has become a bright spot for farmers to increase their income. At the same time, with the deepening of rural reform, farmers' land, housing and other property are more involved in income distribution, rural community cooperation and joint-stock cooperation have developed rapidly, the standard of compensation for land expropriation has been gradually improved, and farmers' property income has increased rapidly. The property income of farmers in some developed areas accounts for more than 1%.

Structural change is an important result of economic development, and structural adjustment is an important means to promote development. The change of farmers' income structure is the result of China's transformation from an agricultural country to an industrial country, which fully reflects the process of economic marketization and policy emphasis on agriculture. In the future, we should mainly give play to the role of the government to speed up institutional innovation, optimize the economic structure and financial expenditure structure, let farmers participate in economic development more equally, let public finance cover more rural areas, and constantly guide and support the upgrading of farmers' income structure.