Chongqing was defined as China’s overall urban and rural development reform pilot zone in 2007, Chongqing conducted many reforms in the perspective of urban and rural economic coordinative development, among which the reform measures such as household register system reform, securitized land system, “three-right”collateral and so on effectively promote the flow of production factors such as labor force, land and capital and so on between urban and rural areas. The synthetic control method is used to analyze the influence of China’s overall urban and rural development reform pilot zone on the gap of the income between urban and rural residents, and the results show that if there is not the pilot zone, the decrease ratio of urban resident income to rural resident income is 12.7 percent, however, the real decrease ratio of urban resident income to rural resident income is 21.8 percent, Chongqing’s overall urban and rural development reform made the ratio decrease 0.37 more. As a result, after the set-up of the pilot zone in Chongqing, Chongqing’s overall urban and rural development reform raises relative income level of rural residents through boosting resources free-flow and has active influence on shrinking the income gap between urban and rural residents, thus, one of important reasons for the emergence and enlargement of income gap between urban and rural residents of China is mis-location of resources and the lifting of the restriction on free-flow of resources can effectively shrink the income gap between urban and rural areas to realize coordinative development between urban and rural areas. DevelopmentReform Shrink the Income Gap? —Empirical Research Based on Synthetic Control Method