scholarly journals Intergenerational Transfer, Human Capital and Long-term Growth in China under the One Child Policy

2013 ◽  
Author(s):  
Xi Zhu ◽  
John Whalley ◽  
Xiliang Zhao
2021 ◽  
pp. 1-42
Author(s):  
Jiajia Gu

This paper studies the effects of China’s one-child policy on human capital and income. I build and calibrate a quantitative OLG model with intergenerational transfers. The model generates a quantity–quality trade-off, so a restriction on fertility leads to an increase in human capital, and higher human capital then contributes to higher individual income and welfare. Calibrating the model to match survey data on urban households, I find that the one-child policy increases the human capital of affected agents by about 47% relative to a counterfactual with no fertility restrictions. However, the effect on aggregate income is negative as the size of the labor force falls.


2020 ◽  
Vol 12 (19) ◽  
pp. 8172
Author(s):  
Pu Liao ◽  
Hui Su ◽  
Dragan Pamučar

The sustainability of China’s Basic Pension System (CBPS) has been challenged by the ageing of the population and the decline in economic growth. This article establishes a Markov model for CBPS to examine whether the reforms, including ending the one-child policy and raising retirement the age, will shrink the negative income–expenditure gap. We find that the negative income–expenditure gap will destroy CBPS in the future in the absence of fiscal transfer or reform. Ending the one-child policy will increase the number of contributors and then reduce the gap in the short term but will worsen the gap in the long term. Raising the retirement age will have several positive effects overall while increasing expenditures in certain periods. The contributions of this article are describing CBPS in detail and establishing a precise model to analyze the effectiveness of reforms.


Significance This year it increased the limit to three. The one-child policy has served more to exacerbate than to alleviate demographic problems, leaving China with an ageing population and shrinking workforce much sooner than other countries at this stage of economic development. Impacts Rising infertility will play a part in depressing birth rates. Vested interests and the government's proclivity for social control will prevent the wholesale abolition of family planning. National and local authorities will introduce policies to promote reproduction; not all of them will necessarily be socially liberal.


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