Territorial Inequality of Net Income per Peasant in Shandong Province and Its Mechanism

Income inequality among farmers living in different regions was an important form of territorial inequalities. Studying the territorial inequality of the net income per peasant was an emphasis of this paper, and Shandong Province was pointed as the case study region. By the help of logistic regression, it could be found that the special distribution of the net income per peasant in Shandong Province was affected by three factors： distance to No.308 National Highway, distance to the coastline in the east of Shandong Province, and urbanization rates. Based on the decomposition of Gini index, the net income per peasant was divided into four parts, and it was found that the income from family business and salary were the two major sources of income. As to the mechanism for income inequality, it was proved that urbanization was still the key factor. In order to reduce income inequality, the local governments should promote urbanization through improving road networks, such as building highways, which could connect rural areas with the major nodes such as big cities and the port cities in the east.