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Aging Population and Economy

Aging Population and Economy

The aging of population and the dynamic evolution of China’s savings rate

WANG Wei;AI Chunrong

Management World,2015,No. 06

【Abstract】 Since entering the aging society in 2000, China’s national savings rate has been rising rather than falling. Over the past 30 years the change in the regional savings rate and the process of population aging has exhibited a highly consistent gradient difference between the eastern and western reregions, with the former higher than the latter. This contravenes the theory of elderly population burden as proposed by the classical life-cycle hypothesis. This article constructs a three-period overlapping generation model that takes into consideration the longevity effect and burden effect of population aging in order to theoretically analyze the above phenomenon while conduct empirical research using sub-provinces panel data. This paper finds that the savings motivation of “taking precautions” due to the prolonged life expectancy accounts for both the rising trend of China’s savings rate in respect of time and the regional gradient difference while the increased burden of the aging population does not have a significant negative effect on the savings rate or explain the variation of savings rate in respect of time and region. Applying the results yielded by the empirical model, this paper also makes a prediction on the trend of the regional savings rate in China from 2015 to 2050, finding that as the population aging process accelerates, the positive effects brought about by life expectancy will be relatively weakened and the elderly burden effect strengthened. Such a change caused the positive-negative conversion of the net effects of the population aging. Driven by demographic and economic factors, the savings rate in the eastern and western regigions started to fall rapidly since 2015 and the savings rate in the western reregions will also embrace a turning point leading to a decline in 2030. Finally, the gradient difference in savings rate among regions will be reduced and reversed.

The mystery of China's high saving rate: an explanation from demographic changes

LIU Kaihao;LIU Yulin

Population & Economics,2015,No. 03

【Abstract】 Since the beginning of the reform and opening up, China's economy has developed at high speed, and the saving rate has set the new records, which is known as “China's high saving rate dilemma.” What are the reasons? This paper has constructed a social savings rate model on the basis of individual savings model, and investigated the impacts of demographic changes on the saving rate, and then engaged an empirical analysis on Chinese panel data from 1989 to 2012. The results of SYM-GMM and threshold regression show that: children's dependency ratio shows a significant negative correlation with saving rate, and the negative effect declines with the improvement of income level. While elderly dependency ratio shows a significant positive correlation with saving rate, and the positive effect increases with the improvement of income level. After calculation we get: children's dependency ratio and elderly dependency ratio can explain 19% of the growth in China's saving rate. The conclusion shows that the new feature of the coexistence of “low birth rate” and “aging” in demographic changes in China is an important reason why the saving rate has been increasing.

Population aging, tax burden and fiscal sustainability

GONG Feng;YU Jinliang

Economic Research Journal,2015,Vol 50,No. 08

【Abstract】 This article builds a simple two-period OLG model to discuss the relationships among population aging, commodity tax burden on the elderly and fiscal sustainability. The results of theoretical analysis show that the proportion of old population has a U-shaped relationship with fiscal sustainability: when the commodity tax burden on elderly population falls below a certain critical point, population aging is harmful to fiscal sustainability; when the commodity tax burden on elderly population exceeds the critical point, population aging has positive influence on fiscal sustainability. Based on China’s 1981–2012 time series data, this article builds a threshold regression model and a threshold cointegration model, in which the threshold variable is commodity tax burden on elderly people, to verify the U-shaped relationship between the proportion of the elderly and fiscal sustainability. This article finds that the critical point is the circumstance that the commodity tax burden on the elderly accounts for about 1.3% of GDP. The policy implication of this article is that the government should raise the retirement age, support the development of senior care industry and improve social security in order to enhance the aging people’s consumption ability and willingness as well as the society’s fiscal sustainability.

Research on effects of population aging on industrial upgrading

WANG Wei;LIU Yufei;PENG Dongdong

China Industrial Economics,2015,No. 11

【Abstract】 China's increasing population aging and the upgrade of industrial structure are the two major challenges which Chinese economy is facing with. The question that whether population aging may block the upgrade of industrial structure or not is the point this paper is going to probe into. This paper summarized the theoretical mechanism of population aging causing the transformation of industrial structure from five perspectives. It also conducted an empirical study through constructing multidimensional industrial upgrading indicators and using the provincial panel data of China from 1993 to 2013. The results show that the population aging not only optimizes the structure of China's primary, secondary and tertiary industry, but also promotes the inner technical structure of manufacturing industry as well as service industry to a higher level. The population aging promotes the upgrade of industrial structure by enhancing consuming demands, speeding up the accumulation of human capital and forcing the enterprises to replace the human working force with capital and technology to cope with the increasing cost of labor force. The population aging also has negative effects on the upgrade of industrial structure for it leads to low productivity. The net effect of population aging on the upgrade of industrial structure is positive. Besides, this paper also finds that the effects of population aging on upgrade of industrial structure vary in different regions. It can be declared that the relationship between population aging and the upgrade of industrial structure is not opposite. Therefore, Chinese government can make full use of the inducing effects of population aging on the upgrade of industrial structure to push the industrial structure to a more advanced level.

Economic development in low fertility era: structure, efficiency and human capital investment

DU Yang

International Economic Review,2015,No. 02

【Abstract】 The changing demographic situation has brought a challenge to the Chinese economy. While it has benefited from the so-called demographic dividend, the fast changes in the demographic situation have prompted it to face the challenge of an aging society even before it becomes a high-income economy. Therefore, China has benefited less from the demographic dividend as it has last for a shorter period of time in the country. It has been China's only option in the future to achieve sustainable economic growth by shaking off the economic pattern centered on accumulation of production factors in the dual-economy era and raise economic growth efficiency through restructuring. A flexible production factor market, enterprises that respond to market changes in a timely manner and well-trained workers and professionals are the three major factors that determine the success of economic restructuring. Meanwhile, pro-active and effective policies that promote investment in human capital should be devised to cope with the challenge brought by population aging.

Population aging and monetary policy: debates and consensus

WU Ge ;ZENG Qingtong

International Economic Review,2015,No. 04

【Abstract】 In developing China, the obvious, fast and intensified population aging has attracted a lot of attention. Population, which was originally a “slow variable,” has increasingly become a “fast variable” in China over recent years. This article summarizes the debates and consensus on the relationship between population aging and monetary policymaking in academia. It finds that the influence of population aging on economic growth is probably mainly negative. It is still quite controversial whether population aging affects the inflation target of monetary policy, and the effects of transmission channels of the monetary policy will differ in the context of population aging. In addition, the special background of “getting old before getting rich” makes China significantly different from other countries in terms of the environment for monetary policy operation.

An analysis of the influence of the aged society on the economic growth and the stimulus policies of Japan

MA Xueli;CHEN Zhiheng

Contemporary Economy of Japan,2016,No. 04

【Abstract】 For the cause of Japan’s long-term economic downturn, the academic circle gives the interpretation and reflection from different perspectives. From the perspective of a long-periodic population and economic fluctuation, the root of Japan’s continued economic stagnation is that the deepening of the aged society has pulled down the potential growth rate of Japan’s economy and has weakened the policy effect of traditional demand management method to stimulate the economic growth. Due to the impact of population inertia, Japanese hyper-aged population age structure will continue to deepen. The total population and labor scale will be shrinking and it will be a long-term impact on the development prospects of the Japanese economy. We should learn lessons from Japan and introduce relevant policies as soon as possible and improve the supporting policies so as to cope with risks caused by the aged society.

Aging, social network and family farming business: evidence from CFPS

HE Lingxiao;NAN Yongqing;ZHANG Zhonggen

Economic Review,2016,No. 02

【Abstract】 The present paper investigates the impact of rural aging labor force and its interaction with social networks on family farming business by using the data from China Family Panel Studies (CFPS) 2010 and 2012. Results show that aging has a significant negative effect on family farming business, but household’s social networks can well alleviate the adverse effect of aging, and the alleviating effect can be enhanced with the increase of the degree of aging. Extended discussions show that buffering effects of social networks are mainly reflected by easing old farmers’ labor constraints; in addition, social networks can help aged farming households transfer land. Our findings not only enrich the empirical studies from the aging perspective in the field of farming business, but also provide preliminary empirical evidence on how to improve aged farming households’ agricultural earnings.

The influences of increases in labor price and aging on leasing rural land

YANG Jin;CHEN Zhigang

Chinese Rural Economy,2016,No. 05

【Abstract】 This paper used the survey data of the survey on fixed-observation points from the Ministry of Agriculture to investigate the influences of the increase in the labor price and aging of the labor force on leasing land. The results indicated that the increase in the labor price had significantly positive influences on leasing rural land. In other words, the increase in the labor price would promote leasing rural land. When it came to the aging labor force, whether the analysis was based on the total samples or the total samples were divided into samples of land leased in or out, or samples in plains and mountainous areas, results of the empirical analysis showed that the aging labor force of farmer households did not have a significant influence on the market on which rural land was leased in or out. In addition, whether the trend of the aging rural labor force would promote or weaken the influences of the increase in the labor price on the market on which rural land was leased in or out? Through analyzing the common effects of both of them, the regression results suggested that the aging rural labor force and the increase in the labor price did not have a common effect on the market on which rural land was leased in or out.

Future impacts of population aging and urbanization on household consumption in China

ZHU Qin;WEI Taoyuan

Population Research,2016,Vol 40,No. 06

【Abstract】 Based on the estimation of the age-specific consumption pattern in both urban and rural China, this paper simulates and analyzes the impacts of population structure characterized by aging and urbanization on household consumption in the near future, and quantifies their contributions. Results show that household consumption presents a significant age pattern. The urban household consumption pattern differs remarkably from that of rural households within each age group. Assuming a constant consumption structure by age, population aging does not have strong impact on the aggregate household consumption in China in 2050 compared with that in 2010, although it can significantly affect the consumption structure. For example, population aging leads to the growth of health care consumption. Population urbanization can considerably promote household consumption. The impact of population size on household consumption will be far less than that of population aging and urbanization. Their contributions to the consumption are relatively stable under various scenarios of population projections and economic growth.

?Influence of population ageing on labor force participation rate

ZHOU Zhuping;LIU Haibin

Population Research,2016,Vol 40,No. 03

【Abstract】 Labor force participation rate is important for labor supply and economic growth. Changes in age structure influence the overall labor force participation rate (LFPR), and population ageing plays an important role in explaining differences in LFPR. By comparing age-standardized LFPR among China, Brazil, France, India, Japan and the US, it is found that LFPR level of young population is considerably higher than that of old population under the same age-specific LFPR. With the decomposition method of differences between rates, it is found that in 2013, the LFPR difference between China and Japan is 12.1 percentage points, of which 79.0% is attributed to their age structure difference. Further empirical analysis through both national and international panel data models also indicate that LFPR is significantly negatively related to population ageing, and is in upset-U shaped relation with the income level.

The future trends of China’s population and aging from 2015 to 2100

ZHAI Zhenwu;CHEN Jiaju;LI Long

Population Research,2017,Vol 41,No. 04

【Abstract】 The implementation of the universal two-child policy will have a profound influence on China’s future trends of population and changing path of aging. Using the data from the 1% population sampling survey conducted by the National Bureau of Statistics in 2015, this paper conducts simulations of the size and structure of China’s population over the years 2015–2100 by taking into account the potential demographic impacts of the fertility policy adjustment. The results show that China’s total population will grow to the peak in around 2029 and then enter the era of negative population growth. China’s population structure will be aging with shrinking working-age population size and expanding elderly population size. The speed of the decline in China’s proportion of working-age population will be fast before 2050 and slow with fluctuations after 2050. China’s size of elderly population will peak in around 2053 and then gradually begin declining. China will experience a rapid increase in proportion of elderly population before 2050 and the pace of population aging will slow down after 2050.

On the mechanism of ageing affecting economic growth: from the perspective of mediating effect

FENG Jianfeng;CHEN Weimin

Population Journal,2017,Vol 39,No. 04

【Abstract】 The relationship between population ageing and economic growth has aroused so much attention. However, there are few studies dedicating to the in-depth study on how population ageing affects economic growth. Therefore, this study theoretically analyzes the effect of population ageing on economic growth from the perspective of mediating effect and finds that there are three intermediary paths, and namely population ageing can affect economic growth by labor productivity, labor participation rate and the proportion of working-age population. Moreover, the statistical data of 31 provinces from 1990 to 2012 indicate that the three variables have significant mediating effects in deed. In addition, calculation results show that labor productivity and the proportion of working-age population contribute to the growth of per capita GDP, while the path of labor participation rate exerts a negative impact. From the perspective of growth path, the effect of ageing on economic growth is mainly driven by labor productivity. This is because the declined birth rate has prompted most parents to increase their investment in children’s education, which helps accumulate important human capital through knowledge teaching and skill training, though the expansion of higher education has delayed a large number of young workers entering the labor market. Therefore, given the time period covered by this empirical study, labor input is manifested more in quality (labor productivity) advantage in population ageing affecting economic growth, and that is, the rapid economic growth is achieved by improving labor productivity.

Peak or plateau? The trend of population aging and rethinking of its influences on the pension system in China

DONG Keyong;ZHANG Dong

Population & Economics,2017,No. 04

【Abstract】 The shape of the trend of population aging determines the strategy selection of the whole economic and social policy. At present, one of the main opinions of population ageing trend is that the population aging will arrive at a peak in about the 2050s in China. However, this concept cannot express the real shape of the population aging trend of China. Actually, the population aging in China is going to witness the most serious period in the 2050s, which cannot be reversed after that. The high-level population aging will last during the end of the 21 century, and population aging plateau maybe a better concept. This judgment determines that the influences of population aging on the pension system will be in long term. In order to deal with the challenge of population aging, China should reconstruct the three-pillar pension system through strategic point of view and do some parameter reform at the same time.

Implications of population aging for labor supply and economic growth in China: a CGE analysis

ZHU Qin;WEI Taoyuan

Population Research,2017,Vol 41,No. 04

【Abstract】 This paper investigates the implications of population aging for labor supply and economic growth in future China. We particularly introduce an indicator of labor supply-effective labor, which takes into account the differences of labor productivity across age groups. Based on a computable general equilibrium (CGE) model, we simulate four scenarios with various labor supply assumptions, and compare their effects on the change of factor labor price, economic output, and industrial structure. Our results show that total effective labor supply in China is expected to peak in 2017 and then start to decline. The falling speed would be faster and more volatile than that of total population and total labor force. In the scenario of effective labor supply, the growth rate of GDP in China in the first half of this century will decline faster and fluctuate greater than that in the other scenarios where labor supply is assumed to be affected by the development of total population or total labor force. If labor supply is assumed to be determined only by the dynamics of working-age population, the future economic growth may be underestimated. Our study suggests that the heterogeneity of labor efficiency of age groups should not be neglected when we assess labor supply, such that we can avoid misjudging future economic growth and industrial structure change.

How does population aging affect technology innovation

YAO Dongmin;NING Jing;WEI Shiyan

The Journal of World Economy,2017,Vol 40,No. 04

【Abstract】 China is now facing a challenge that the innovation output is nibbled by the aging population problem. It is still a mystery for the academia that how an aging population suppresses people’s innovation behavior. Based on literature analysis, this paper discusses a channel, namely that the aging population problem reduces the output of technology innovation by undermining the human capital accumulation. In addition, this paper uses China’s provincial panel data, with dynamic panel models and the system GMM method, to verify this channel. We find that the aging population rate has a significant negative effect on innovation, which is the cause of human capital decline. This confirms the channel discussed above. Additionally, we use the quantile regression to analyze the effect on the technology innovation of regions with different levels of economic development. The results show that in regions with a higher level of economic development, the negative effect of the aging problem on innovation is more serious. We also analyze how the aging problem affects the different types of technology innovation. Our findings suggest that the aging problem has a negative effect only on the number of approved invention patent applications and that of approved design patent applications.

Participation of social activities, health promotion and disability prevention: empirical analysis based on Active Ageing structure

HU Hongwei;LI Yanyu;ZHANG Chu;ZHANG Jiaxin

Chinese Journal of Population Science,2017,No. 04

【Abstract】 Participation of social activities, one of the core contents of Active Aging, is good for senior adults’ health promotion and disability protection. With Active Aging perspective, this paper estimates unbiased impact of participation of social activities on elderly’s health and disability by using Chinese Longitudinal Healthy Longevity Survey data in 2014. The results show that: (1) There exists endogeneity between participation of social activities and health of the old. The positive effect of participation of social activities on health is overestimated about 20.7 percent without considering endogeneity. (2) By using instrumental variable method to solve the endogeneity, the participation of social activities exerts positive impact on senior health, and the result is robustness. (3) Participation of social activities has disability prevention. Compared with body disability, it has more positive prevention to instrumental disability. (4) Participation of social activities has much larger impact on the elderly with lower health level. This paper further deepens the understanding of Active Aging, and brings forward a series of suggestions from core pillar and supplemental pillar viewpoints.

Population aging, asset price, and capital accumulation

GENG Zhixiang;SUN Qixiang;ZHENG Wei

Economic Research Journal,2016,Vol 51,No. 09

【Abstract】 Declining birth rate and rising life expectancy can deepen population aging. They can affect asset price and capital accumulation through saving and investment. This paper introduced capital adjustment technology with convex adjustment costs and developed a cross-generation model, where asset price is determined endogenously under different social security institutional arrangements on the basis of neoclassical growth model. The study shows that declining birth rate decreases national saving and investment, lowers asset price, and raises capital accumulation. Asset price and capital stock are mean reversion, so the initial decrease of asset price and increase of capital stock is followed by increase and then decrease. However, the rising life expectancy can increase asset price in the current period by a mean reversion process. In addition, life expectancy, social security tax, pension system rate, and appropriation of personal accounts do not affect asset price in the long run. They cause long-term asset price with deflation effect, when both of them occur in the same period. In the short run, the rising life expectancy will lower the capital accumulation in the current period. In the long run, when the capital-output elasticity drops, the capital accumulation for the long run rises with life expectancy; when the capital-output elasticity rises, an asymmetric inverse-U exists between them. Our conclusion has important policy implications, namely, it is necessary to enhance supply-side reform against the economy developing in the demand-side management. It is an effective way to deal with the deflation effect of capital price and increase capital accumulation by improving total factor productivity (TFP) for the long run.

Sovereign debt risks under the impact of aging

HUANG Xiaowei;HUANG Yixuan;GUO Min

The Journal of World Economy,2017,Vol 40,No. 03

【Abstract】 This paper studies the influence of population structure on sovereign debt risk systematically. Aging population is a crucial trigger for the debt crisis. “Silver Wave” reduces the government’s paying capacity and paying willingness, and then increases sovereign credit risk. Based on the three-period OLG model, this paper discusses the internal mechanism of how demographic aging affects debt default risk in theory. Using the two-way fixed-effects model, our empirical study finds that life extension and increasing elderly dependency ratio have significant positive effect on debt scale and sovereign credit default swap, and “the second demographic dividend” does not improve the sustainability of sovereign debt. Aging of the elderly would lead to greater debt risks compared with population aging.

Population aging, migration, financial leverage and the economic long swing

TAN Haiming;YAO Yudong;GUO Shuqiang;NING Chen

Economic Research Journal,2016,Vol 51,No. 02

【Abstract】 This paper used housing price as a linking factor and integrated the Kuznets “long swing” in demographic economics and the hierarchical urban systems model in geo-economics. It built a CGE model for China’s long swing and used demographic and macroeconomic data of Japan to estimate the model and to analyze the long-term impact of population aging and migration on China’s economic growth, urbanization and housing prices during 2015–2050. It also added financial leverage and rational expectation factors to the model, so as to study the linkage between financial leverage, economic growth, and demographic policies. This study finds that the aging problem will cause a step-down of China’s economic growth rate during 2021–2025, which will trigger off the slide of housing prices across the country and cause the phenomenon of de-urbanization. In order to maintain long-term sustainable growth, more focuses should be placed on three key rates. Firstly, the total birth rate(TFR). If the government adopts policies to raise the TFR, economic growth will be stimulated both in the short-term and in the long-term. Secondly, the migration rate. Easier migration policies will help upgrade the economy and thus increase the growth rate. Thirdly, the financial leverage ratio. Flexible adjustment of the leverage ratio with a long-term ceiling in mind will help stabilize economic growth. In addition, the excessive limitation on the naturally rising leverage ratio will hurt economic growth.

Unbalanced economic development, migration and regional differences of ageing: an empirical study with data of 287 cities in China

CHEN Rong;WANG Meifeng

Population Journal,2018,Vol 40,No. 03

【Abstract】 Due to the regional differences of the social economic development and the progress of population change, the aging of population shows regional imbalance in China. In addition, the most massive migration which is taking place since late 1980s has been changing the spatial pattern of population ageing in China. However, it is rare to study the regional imbalance and its evolutionary trend of population aging on the prefecture-level city level. Therefore, based on the fifth and sixth national population census data of 287 prefecture-level cities in China, this paper measures the regional differences and its evolutionary trend of population ageing in China from the perspectives of ageing degree and speed, and discusses how the unbalanced economic development and large-scale population migration to reshape the spatial distribution pattern of ageing by using the multivariate quantitative model. The findings show that regional imbalances of population aging have changed since 2000 in China. In the original thinking, the ageing degree is higher in the more developed areas. However, the ageing has been faster and even higher in the less developed areas from 2000 to 2010. In addition, the ageing has slowed down in the more developed areas and even declined in several cities. The gap of aging level between East zone and the other three zones (i.e. West, Central, and North-east) has considerably narrowed down. The major factor leading to this change is the large-scale internal migration with obvious age selectivity and orientation preference, which is basically due to imbalance in economic development of regions. Population agglomeration is expected to continue in China, and the regional difference of ageing will deepen, which will in turn exacerbate the imbalance of the different regional economic development.

Will population aging impede the escape of middle-income trap?

FAN Hongmin;MU Huaizhong

Population Research,2018,Vol 42,No. 01

【Abstract】 Using cross-country panel data, this paper analyzes the relationship between population aging and economic growth, and further examines the impact of population aging on the probability of avoiding the middle-income trap. We find that there is a significant negative relationship between population aging and economic growth. The increase of the overall dependency ratio would decrease the probability of avoiding the middle-income trap. The impact of the old-age dependency ratio on the probability of being fallen into in the middle-income trap is not significant. Enhancement of human capital and technology progress would increase the probability of avoiding the middle-income trap. Therefore, measures should be taken to cope with the negative effect of aging on the economic growth in order to avoid the middle-income trap. These measures include enhancing the level of human capital and increasing investment on research and development.

Analysis on the impact of population aging on the development of China’s service industry

WU Feifei;TANG Baoqing

Chinese Journal of Population Science,2018,No. 02

【Abstract】 The paper analyzes the positive and negative effects of population aging on the development of the service industry, and conducts an empirical test based on the provincial panel data from 2005 to 2015. The results show that, on the whole, as the construction of China’s modern service industry system adapting to the population aging trend is still in its infancy, the labor costs are increased with aging, and China’s eldercare security system remains to be improved, the increasing population aging will hinder the development of China’s service industry at the current stage; from a regional perspective, due to the differences in regional elemental structures and development phases of the service industry, compared with the central and western regions, the population aging in the eastern region poses more significant impediment to the development of the service industry; further studies show that the improvement of the eldercare security system can, to a certain extent, weaken the negative effect of population aging on the development of the service industry in China. With the increasing population aging, China should respond to the negative effect of population aging and keep promoting the quality development of the service industry by cultivating quality demographic dividends, increasing effective labor supply, and improving the eldercare security system.

Population aging and its effect on total health expenditure: a perspective of prospective age

YANG Xin;ZUO Xuejin;WANG Meifeng

Population Research,2018,Vol 42,No. 02

【Abstract】 With the continuous extension of life expectancy, the negative impact of population aging may be exaggerated by using a static age perspective. In this paper, we try to forecast the population aging trend of China under different age criteria in 2010–2050 and analyze their effects on total health expenditure. The results show that aging rate measured with prospective age would be much lower than that measured with chronological age and the health expenditure for the elderly would be considerably reduced. The implications are that the ratio of labor force to the elderly population would change, which would reduce health expenditure. However, in achieving that, it is necessary to promote the relevant social policies such as encouraging the postponement of retirement age, changing the concept of health service, and reforming the health service system.

Ageing, social network and the adoption of green production technology: evidence from farm households in six provinces in the Yangtze River Basin

YANG Zhihai

China Rural Survey,2018,No. 04

【Abstract】 Based on a rural survey in the Yangtze River Basin consisting of 1027 farm households in Sichuan, Hubei, Hunan, Jiangxi, Anhui and Jiangsu provinces, this paper analyzes the impacts of ageing and social network on farm households’ adoption of green production technology. The findings are as follows. First, 28.2% of farm households have not adopted any green production technology, while the other households have adopted at least one of the technologies, especially the technologies of retaining crop straws and stalks on farmland, deep plowing and scarification, and use of commercial organic fertilizers. Second, ageing is found to be negatively associated with farmers’ adoption intensity, while social network exerts a positive and significant impact. Third, as regards the two dimensions of social network, both relatives’ network and friends’ network are found to have significantly positive impacts on farm households’ adoption. Fourth, social network can weaken the negative impact that ageing exerts on the technology adoption behaviors. However, the weakening effect is only significant to the relative network.

The diversification of children's support for their parents in the context of an aging society: concepts and behavior

HU Anning

Social Sciences in China,2017,No. 03

【Abstract】 China's aging society and the family-based model of basic aged care determine that children's support for their parents directly affects the standard of living of the majority of the aging population. Existing theories indicate that in this era of social transition, the implications of filial piety have shifted from the traditional emphasis on the parent child generational relationship and children's duty to obey their parents to a dual mode in which family love coexists with the authority of the elders. Using data from the Chinese General Social Survey of 2006, we explore the ways in which the two basic dimensions of authoritarian filial piety and reciprocal filial piety connect with various types of filial behavior. The results of our multivariate linear model show that on average, authoritarian filial piety, which emphasizes authority relationships and children's duty, increases children's financial support for their parents, while reciprocal filial piety, stressing family love and generational equality, significantly increases children's emotional support for their parents. A comparison of the basic dimensions of filial piety shows that neither significantly increases children's physical support for their parents. Further analysis of the interaction effect indicates that the link between authoritarian filial piety and financial support is more significant among younger groups. In addition, for males, a marginally significant positive relation exists between authoritarian filial piety and physical support for their parents.

Labor substitution effect of artificial intelligence in the era of population aging: evidence from panel data across countries and panel data at provincial level in China

CHEN Qiulin;XU Duo;ZHOU Yi

Chinese Journal of Population Science,2018,No. 06

【Abstract】 Based on panel data across countries and panel data at provincial level in China, this study explores how population aging induces the application of artificial intelligence (AI) and how the application of AI affects economic growth with the two-stage least squares model. It investigates whether the application of AI substitutes labor force, and if yes, how such a substitution effect works. The results show that, the shortage of labor force caused by population aging would push an economy to apply more AI in production. Population aging is conductive to the development of AI. The application of AI has positive effects on local gross production and hence partially offsets the negative impact of population aging on economic growth. AI plays an important role in reacting to population aging. The development of AI is induced innovation driven by population aging, thus it is the complementary substitution for labor force rather than the crowding-out substitution. With these mechanisms, AI is expected to contribute greatly to the economy in the era of population aging.

The influence mechanism of population aging on industrial structure in China: empirical analysis based on synergy and mediated effects

LU Jin;LIU Lu;GUO Zhiyi

Chinese Journal of Population Science,2018,No. 03

【Abstract】 Taking data on 31 provincial regions from 1993 to 2015 as samples and focusing on the influence of population aging on industrial structure, the paper studies the influential synergy effects of population aging and migration on industrial structure, and tests five one-way action mechanisms of industrial structure influenced by population aging. The study shows that population aging has a positive effect on industrial structure. Specifically, the marginal effect of population aging on industrial structure increases with the increase of population migration. Population aging accelerates the accumulation of human capital and forces companies to replace labor and material capital with technology and human capital, which are good for the upgrading of industrial structure. However, population aging reduces labor productivity and increases the burden of social security, which hinders industrial upgrading. In addition, although population aging promotes old-age consumption, the aging industry needs to be developed. The paper suggests that China should make full use of the leading role of population aging in industrial upgrading, promote the accumulation of human capital, guide orderly population migration, increase investment in the elderly consumer market, and eventually achieve the optimization and upgrading of the industrial structure.

Impact of age on household financial asset allocation efficiency

QI Mingzhu;ZHANG Chenggong

Population & Economics,2019,No. 01

【Abstract】 There are three main sources of income for the elderly: family, public pension and property income. The income level of family financial assets will determine whether the elderly have enough financial support in the future, and their allocation efficiency will also determine the future security of old-age care. Using the data of 2013 China Household Finance Survey, Tobit model and intermediary effect model, this paper empirically analyzed the impact of the age of the head of household on the efficiency of household asset allocation in China, and the mesomeric role of investment risk preference. It is found that the efficiency of household asset allocation portfolio is influenced by the age of the head of household, and this relationship is not simply linear or hump-shaped but is of a bimodal pattern with two peaks. Investment risk preference has a partial mesomeric effect on the impact of age on asset allocation efficiency, and the mesomeric effect will gradually increase with the increase of the age of the head of household. The purpose of this paper is to put forward reasonable suggestions for optimizing household asset allocation, and to increase security for the future pension.

Research on regional difference and polarization trend of population aging from 1995 to 2014 in China

CHEN Minghua;ZHONG Chongyang;ZHANG Xiaomeng

The Journal of Quantitative & Technical Economics,2018,Vol 35,No. 10

【Abstract】 Research Objectives: This paper aims to analyze the regional differences and evolution trend of Chinese aging. Research Methods: This paper is to analyze and decompose the regional differences of population aging by the Theil index, investigate the degree and evolution trend of polarization by Wolfson, ER, EGR, LU indices and kernel density estimation. Research Findings: The level of Chinese aging is on the rise and the spatial difference is featured by inequality. There are greater differences within the region in East China and West China, and there are smaller differences within the region in Central and Northeast China. The overall difference is mainly caused by intraregional differences. In addition, the spatial polarization of Chinese aging experiences a downward trend and the trend of multipolarization has also been relieved. Research Innovations: Based on the comparison of four regions, this paper not only examines the overall difference in population aging, but also examines intraregional and interregional differences. It not only analyzes polarization and multipolarization of the population aging, but also estimates the polarization evolution trend of population aging. Research Value: This paper attempts to provide reference for depicting the regional difference of population aging and spatial polarization, formulating the strategy of regional population development and dealing with the population aging in a coordinated manner.

Analysis of the impact of population aging on labor productivity in China: an empirical study based on non-linear methods

FENG Jianfeng;CHEN Weimin;JIN Lizhen

Population Journal,2019,Vol 41,No. 02

【Abstract】 Improving labor productivity is key to achieving high quality transformation in development. As China has entered the aging stage, the impact of aging will be more and more obvious. A thorough study of the relationship between aging and labor productivity will not only help us to understand the economic effects of population aging deeply, but also play an important role in dealing with the problem of population aging. Based on the empirical analysis, this paper makes a research of the impact of population aging on labor productivity in China by means of non-linear method. Through the empirical study of panel data of 31 provincial regions from 1990 to 2012, the results are as follows. Because China is in the initial state of aging society, Chinese aging has significantly positive effects on labor productivity. However, threshold study indicates that the positive effects have been weakened in the areas with high degree of aging, and this phenomenon of progressive decline should arouse a high degree of concern. As for the current social situation, on the one hand, government should seize the opportunities for the early stage of aging society, speed up the construction of a talent training system for industry, university and research, and provide a sufficient think tank foundation for the effective promotion of labor productivity in future. At the same time, all walks of life should actively respond to the negative impact of highly aging society in the future on labor productivity, and further seek opportunities for the development of the elderly population dividend through exchanges and cooperation. Based on the above conclusions, this paper not only responds appropriately to the differences in academia, but also has important significance in actively dealing with the problem of population aging and speeding up the development of aging business and industries.

A study on spatial-temporal pattern of population aging and its factors in China: based on county-level examination

WANG Lucang ;WU Rongwei

Chinese Journal of Population Science,2016,No. 04

【Abstract】 Based on the 5th and the 6th population censuses of China and by employing the geographical detectors and multiple linear regression analysis methods, this paper analyzes the aging pattern and its changing process in China’s 2283 towns. The results are as follows. Firstly, there are significant spatial differences on the county level in China’s population aging. The Hu’s Line is the geographical boundary for population aging which shows significantly higher level in the southeast half than in another half. Secondly, the spatial distribution pattern changes of population aging were significant from 2000 to 2010. Severe aging areas have a fragmented trend in coastal areas and a continuous trend in inland areas; higher aging areas have appeared in the northwest of Hu’s Line; moderate aging areas extend in band shape along the Lanxin railway and spread in the northeast region; light aging areas have remarkably agglomerated trend in space distribution. Thirdly, the growth speed of population aging has significantly spatial difference and spatial correlation. Overall, the aging growth rates in inland and border areas are higher than those in coastal areas. The growth rate of higher aging areas is slow while that of slower aging areas is fast. Lastly, changes of spatial and temporal patterns are a result of multiple factors. The population replacement is the most important factor, and population flow is the determinative factor of spatial pattern change of population aging.

The influence of population aging on investment risk preference: an old-age security perspective

QI Mingzhu;ZHANG Chenggong

Population Research,2019,Vol 43,No. 01

【Abstract】 With population aging, there is a decline of retirees’ dependence on pension and their children, while the accumulation of assets and the return on assets during the work period become more important for their future pension security. Investment products at different risks have various capital return rates. Residents’ investment risk preference will directly decide residents’ investment preferences and portfolio demand, and therefore affect the returns on asset in the future. Using the data of 2011 Chinese Household Finance Survey, this paper empirically analyzes the influence of age on the risk preference of residents by establishing a series of ordered logistic regression models. The results show that the investment risk preference during different life cycles is different, and the risk preference of the residents gradually decreases with age. Population aging will reduce the overall investment risk preference and develop a low return rate through adjusting the supply and demand of the future investment market. Finally, this paper puts forward policy suggestions to the old-age security in China.

Population aging, regional innovation and the upgrade of industrial structure

ZHUO Chengfeng;DENG Feng

Population & Economics,2018,No. 01

【Abstract】 Based on Chinese provincial panel data from 2003 to 2015, this paper built spatial weight matrix from the perspective of innovative talents’ interregional flow, investigated the heterogeneous effect of population aging on the upgrade of industrial structure, the heterogeneous leverage and evolution characteristics among them from regional innovation. Research shows the following findings. (1) During the investigated period, China’s overall industrial structure optimizes ceaselessly with the increased polarization phenomenon, and there is the “beggar-thy-neighbor” phenomenon around the overall country in the process of promoting the upgrade of industrial structure. (2) From the perspective of the overall country and the western region, population aging hinders the upgrade of industrial structure, but the effect is not significant in eastern region. Additionally, there is a significant positive correlation between the population aging and the upgrade of industrial structure in central region. (3) The ascension of innovation ability can significantly weaken the prevention of the population aging to upgrade of industrial structure, but as far as central region, the leverage of regional innovation is not significant. (4) For the whole China, and eastern and western regions, with the regional innovation ability leaps over the two threshold values, the influence of population aging on the upgrade of industrial structure appears the evolution of “block → not significant → promote,” but for the central region, its evolving regularity is “not significant → block → promote.” Based on the above research, some suggestions were put forward.

Population aging in China and regional economic growth

WANG Guixin;GAN Yihui

Chinese Journal of Population Science,2017,No. 03

【Abstract】 Based on the Harvard Model, this paper empirically analyzed the impact of population aging on the regional economic growth of the 31 provincial regions, using the panel data every 5 years from 1990 (1990–2015) and the fixed effect model. Result showed that the growth rate of the total population, the population growth rate of population aged 0–14 and the growth rate of children’s dependency ratio have a statistically significantly negative impact on regional economic growth, while the growth rates of labor population ratio, labor participation rate, the elderly population and the elderly dependency ratio have positive effects on regional economic growth but without statistical significance, which implies that the current stage of China’s population aging has not yet formed a negative impact on regional economic growth in a certain sense. However, in the future, it’s hard to avoid the negative effect of population aging on regional economic growth as the former becomes increasingly serious. Therefore, it is necessary to assess the effect of population aging on regional economic growth, prepare for the future, and to develop an integrated approach to aging through the whole society system.

Is population aging restraining China’s economic growth?

QI Hongqian;YAN Haichun

Economic Review,2018,No. 06

【Abstract】 This paper, with the balanced panel data of 31 provincial-level regions in China from 2001 to 2015, constructed a panel smooth transition regression (PSTR) model and made an empirical test of the threshold characteristics, dynamic changes and regional differences of the impact of population aging on economic growth. The results showed that the impact of population aging on economic growth presents non-linear and significant threshold characteristics. Based on the time series analysis of longitudinal section, we found that the positive effect of population aging on economic growth decreased first before going down. Based on the individual analysis of cross section, we found that the impact of population aging on economic growth was significantly different in different regions. Therefore, it is necessary to correctly understand and comprehensively grasp the threshold effect and the time and space difference of the impact of population aging on economic growth in China, and strengthen the positive effects and weaken its adverse effects, which will bring positive and realistic value to the formulation of the countermeasures on population aging as well as the steady and sustainable growth of the economy.

Social participation profile of the Chinese elderly in the context of active aging: patterns and determinants

XIE Lili;WANG Bin

Population Research,2019,Vol 43,No. 03

【Abstract】 Based on elderly adults’ involvement in economic, social, political and family activities, we use data from China Longitudinal Aging Social Survey (CLASS) in 2014 to examine their patterns of social participation by latent class analysis. We identify three active modes: high participation type, low participation type and family care type, which are consistent with the characteristics of family culture in China. Multinomial Logistic regression analysis is further adopted to investigate the association between their participation patterns and individual, social, economic and environmental factors. Results suggest that the influential framework can explain the differences in types of participation patterns. In order to improve the internal and external abilities of the older adults in social participation, we should develop lifelong education, strengthen the capacity of social organizations, improve the elderly-age service system, and establish an age-friendly environment. Particularly, we should pay attention to the needs of socially vulnerable elderly groups to build society for all ages and promote healthy aging and active aging.

Aging and the effectiveness of fiscal and monetary policies

LI Jianqiang;ZHANG Shucui

Journal of Finance and Economics,2018,Vol 44,No. 07

【Abstract】 This paper introduced the population structure, the fiscal expenditure structure and the monetary policy into the new Keynesian dynamic stochastic general equilibrium framework, focusing on the analysis of the impact of population aging on China’s macro-economic control policies. The results of this paper are as follows. In addition to the negative impact of the aging population on economic growth, the space for maneuvers left for macro-control policies has become increasingly limited, affecting the effectiveness of policy control and increasing the cost of policy implementation. First, with the aging population structure, the positive effects of macroeconomic control policies have been weakened and the negative effects have been strengthened. This shows that population aging has undoubtedly weakened the effectiveness of fiscal and monetary policies. In terms of macroeconomics, the basic effect of population aging is that it will profoundly change the relationship between the national income distribution pattern and the allocation of economic resources. In the long run, population aging reduces labor supply, and the overall economic life cycle gap widens the lack of economic growth and the overall welfare level of society continues to decline. In the short term, accelerating the burden of financial pensions has significantly reduced the space for fiscal policy maneuvers and also weakened the ability of the government to implement anti-cyclical fiscal policies. In terms of policy assessment, the decline in fiscal multipliers has masked the enthusiasm of the financial sector, amplifying its crowding-out effect and impairing the quality of financial performance. In terms of the monetary policy, population aging may bring deflationary pressures, limit the monetary policy’s ability to stimulate aggregate demands, force the central bank to adopt more radical measures to achieve the same effect, and be directly exposed to higher macro-economic risk exposures and strengthen financial fragility. Second, in the elderly-dominated society, the central bank’s tolerance for inflation rate has decreased, and interest rate adjustments are more likely to approach the lower limit. Once these new weighing factors are superimposed on the cycle, they will further complicate the operation of the monetary policy. The central bank must not only prevent the spread of inflation, protect the economic interests of the elderly, but also prevent the “hard landing” economic risks caused by excessive tightening. Objectively, the frequency of policy switching will exceed the previous level, and unconventional monetary policies will probably become the norm. In terms of stabilizing the economy and finance, the lack of effective demand caused by population aging has weakened the effectiveness of traditional monetary policy operations. Severe aging may further trigger liquidity traps and no longer be affected by loose monetary policies. Low interest rates are stimulating investment and consumption. The role is limited. Enterprises no longer pursue profit maximization but minimize debt. As a result, the demand for bank credit is insufficient and the liquidity of the central bank is difficult to release. Under such circumstances, structural reform will become a necessary supplement to the monetary policy. Third, increasing the proportion of working population and maximizing the negative effects of accelerating population aging can greatly improve and increase the effectiveness of fiscal and monetary policies. The loose population policy does not necessarily change the demographic structure and promote economic growth in the short term. The economic problems brought about by population aging are a rather complicated social project. It is not simply a matter of “opening up policies and stimulating fertility” that can open the door to alleviate the aging population. Moreover, increasing the labor participation rate will increase the proportion of the working population to a certain extent, effectively increase the supply of labor force, and reduce the tax burden on each of the young people. More importantly, increasing the labor participation rate can effectively increase the labor supply, not only helping to ease the burden of government pensions and guaranteeing the reliability of the pension system in the medium term, but also helping to reduce macroeconomic fluctuations, expand fiscal and monetary policies to create more space for operations, stimulate private consumption and investment, and drive economic growth.

Inversion of urban and rural population aging: universality and periodicity

LIN Bao

Population Research,2018,Vol 42,No. 03

【Abstract】 Based on the urban-rural data by age and sex released by the United Nations in 2014, it is found that the phenomenon of urban-rural inversion of population aging is universal. There are clear developmental stages for the differences between urban and rural population aging with two turning points when the proportion of population aged 60 and above reaches 3%–4% and 10%. In the first stage (the proportion of population aged 60 and above is lower than 3.5%), the urban-rural difference increases by 0.172 percentage point for every percentage point increase of the proportion of population aged 60 and above in the total population. In the second stage (the proportion of population aged 60 and above is greater than or equal to 3.5%, but lower than 10%), the urban-rural difference is reduced by 0.243 percentage point for every percentage point increase of the proportion of population aged 60 and above in the total population. In the third stage (the proportion of population aged 60 and above is greater than or equal to 10%), the urban-rural difference increases by 0.211 percentage point for every percentage point increase of the proportion of population aged 60 and above in the total population. Combined with theoretical analyses, this paper proposes a revised urban-rural difference transformation model explaining the inversion pattern of urban-rural aging in most of countries and regions in the world.

Aging with fewer children, pension equilibrium and parametric reform: an empirical analysis based on OLG model of China, Japan and the Republic of Korea

LIU Rumei;HE Guosheng

Population Journal,2018,Vol 40,No. 06

【Abstract】 The crisis of aging with lower fertility has occurred in China, Japan, and the Republic of Korea under the dual effects of the increase of life expectancy and the decline of total fertility rate. According to the simplified OLG model and sensitivity analysis of some parameters, the rise of the elderly dependency ratio and the unreasonable setting of the system parameters (i.e., the replacement rate of pension, contribution rate, and retirement age) have gradually led to the unbalance of pension system in these three countries. Under such circumstance, an appropriate adjustment of the pension parameters would be helpful for improving the balance of public pension, alleviating the financial burden of the government, and maintaining the long-term sustainability of public finance. Accordingly, three countries have carried out the structural and parametric reform of pension system. The structure reform of pension system is mainly to build a multi-pillar pension model based on public pension, and gradually expand the proportion of the second pillar (occupational pension). The parametric reform of pension system mainly includes increasing the retirement age, reducing the replacement rate of pension, moderately adjusting and controlling the contribution rate, and expanding the financing channels. The empirical analysis shows that, firstly, the reform of the structure and parameters helps to improve the long-term equilibrium of public pension, and the comprehensive reform of the structural adjustment and optimization of the system parameters should be carried out. Secondly, the reform of the structure and parameters should not only consider the long-term equilibrium of public pension, but also consider its impact on the private savings, the redistribution of income, and the labor market for reducing the side effects of the policy on economic growth. Thirdly, the reform of the structure and parameters should be implemented according to the national conditions, the international standards of social security and other countries’ experience. Some practical policies should be implemented for achieving the Pareto efficiency.

Reform of social security system under the risk of population aging: basing on the case of ROK

LI Tianguo

Contemporary Korea,2019,No. 02

【Abstract】 In order to cope with the increasingly serious social problems of aging, the Republic of Korea (ROK) has continuously strengthened the construction of social security system and promoted system innovation. The government combines Confucian cultural tradition with social security system to form a unique social security model. The ROK vigorously advocates that enterprises should build social security network with the central government, local governments, communities and families. The social security system based on enterprises has become an important feature and innovation of the ROK’s social security system. China needs to learn from the ROK, improve the managerial level of basic social security, pay attention to practical effect, and formulate a relatively mature social security system with Chinese characteristics.

Seventy years of China: the changes of population age structure and the trend of population aging

WANG Guangzhou

Chinese Journal of Population Science,2019,No. 03

【Abstract】 Based on the population censuses and 1% sampling survey data, this paper uses the indirect estimation methods to reconstruct the changes of population age structure for 70 years of China. The main conclusions and insights are as follow. (1) During the past 70 years, Chinese population has experienced both dramatic increase and decrease. The changes in the first 35 years are mainly determined by social-economic situation, while those in the second 35 years are influenced jointly by strict family planning policy and social-economic conditions. (2) Compared with the population changes from 1959 to 1961, the nature of baby boom in response to the universal two-child policy in 2015 is completely different. Yet, they both result in a baby boom for about two years.(3) The recent 35 years witnessed low fertility and decreasing number of new births, which strengthens the trend of population age structure. The proportion of elderly population will eventually exceed 30%, and will remain at high levels in the future.

The mechanism of introducing community currencies to mutual support time savings: financial innovation to deal with population aging

ZHENG Hong;LI Ying;LI Yong

Journal of Finance and Economics,2019,Vol 45,No. 05

【Abstract】 In order to cope with population aging, the mutual support time saving mode has begun to be piloted in some small communities. The purpose of this paper is to demonstrate the mechanism of introducing government-guaranteed community currencies to mutual support time savings against the background of population aging. Based on Samuelson-Diamond two-generation overlapping model, this paper designed and built the old-age care service saving model with fiat money as the medium and the mutual time saving model with community currencies as the medium respectively. The results show the following. (1) The use of fiat money as the medium of savings inhibits people’s willingness for old-age service savings. (2) The introduction of community currencies as the medium of mutual support time savings not only enhances people’s motivation for old-age care service savings, but also is more in line with the new normal of population aging. (3) Compared with fiat money, community currencies are more suitable to act as the medium of mutual support time savings. The research conclusions are as follows. As a financial innovation of aging society, the introduction of community currencies with national credit guarantee can overcome the limitations of the current time saving mode, achieve the optimization of idle endowment resource allocation beyond the family in society as whole, and realize the gradual transformation from family endowment to social endowment, in order to cope with the new normal of population aging. This paper can provide theoretical support and decision-making reference for the government to issue community currencies with national credit guarantee.

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