Abstract:Based on 731 samples of urban and rural households in Gansu province,this paper analyzes the urban-rural differences in levels of entrepreneurship and its affecting factors with the help of Probit model.The result shows that entrepreneurship rate of urban areas is higher than that of rural areas and the average household entrepreneurship rate in Gansu is only 12.45% and the overall level of entrepreneurial activity remains to be improved.This paper concludes that the choices of entrepreneurship are mainly affected by the household net assets,the age of the head of household,the labor proportion and the location of the household.Besides,rural-urban differences in financial development and the related social security system substantially contribute to the urban-rural differences in levels of entrepreneurship of western families.Therefore,this paper proposes several policy suggestions.Firstly,to improve financial development and relieve the financing restriction of entreprenurship; secondly,to perfect financial resource distribution and promote the connection of financial and industrial development; thirdly,to increase the commercial envrionment and form the cluster effect of entreprenurship and finally,to perfect relevant system and effectively diversify the entreprenurship risks.