Abstract: Based on the inter-provincial panel data of China from 2000 to 2014, this paper discusses the impact of upgrading of industrial structure on the urban-rural income gap by using the panel threshold model, and analyzes the regulatory role of human capital in its two dimensions. The study finds that, as a whole, the upgrading of industrial structure narrows the urban-rural income gap, but its influence has spatial differentiation, and human capital plays an important regulatory role;the result of sub-regional study shows that the eastern region has a negative “U”-shaped of non-linear effect; the central region does not exist the statistical sense of the threshold effect; the western region of human capital stock can significantly inhibit the expansion effect of upgrading of industrial structure on urban- rural income gap, but human capital structure has exacerbated this effect. Further analysis shows that only Beijing, Liaoning and Shanghai are in the optimal range of human capital, thus improving the human capital stock and optimizing the human capital structure is still an important focus for the vast majority of provinces to promote the upgrading of industrial structure to narrow urban-rural income gap.

Key words: upgrading of industrial structure, urban-rural income gap, human capital, threshold effect