Tian Xueyuan: Has China's demographic dividend disappeared?

Author: Tian Xueyuan, member and researcher of the Chinese Academy of Social Sciences For some time now, the term demographic dividend has appeared quite frequently. For example, the economic downturn is attributed to the disappearance of the demographic dividend, and even the disappearance of the demographic dividend to interpret the stock market decline, rising prices and wages, and widening income gap. However, some interpretations are specious. The judgment of the demographic dividend, involving strategic planning and policymaking, it is necessary to clarify. What is the demographic dividend? Some people say that the power of many is the demographic dividend; some people say that cheap labor creates a demographic dividend. This is actually a misunderstanding of the demographic dividend as the population size effect and labor surplus. According to demography, in the process of demographic transition, due to the declining birth rate and the limited growth of the elderly population, there will be a period of demographic "golden age" in which the working-age population will account for a relatively high proportion of the population and the number of the population will be relatively large. During this period, the dependency ratio (the sum of the teenage population and the elderly population/the working-age population) is low, and the burden on the labor force is light, which is conducive to the growth of savings and investment, thus providing a demographic dividend for economic development. The reason why it is called demographic dividend is that it can earn interest just like monetary savings. An abundant working-age population is equivalent to a larger amount of "savings"; a lower population dependency ratio is equivalent to a higher "interest rate". The opposite is true. A complete demographic transition generally involves a process of demographic liabilities - demographic dividends - demographic liabilities. What people pursue is to maximize the value of demographic dividend and the dividend period, and minimize the value of demographic liability and the liability period. How long is the demographic dividend period in China? Some people believe that China's demographic dividend has disappeared after entering the 21st century; others regard the arrival of the peak of the demographic dividend in 2010 as the end of the demographic dividend period and use it as a theoretical explanation for the slowdown of economic growth. This is also a misunderstanding. In the demographic transition process of high births, high deaths, low growth - high births, low deaths, high growth - low births, low deaths, low growth, the "interest rate" of the demographic dividend changes in an inverted U-shaped curve with two low ends and a high middle. If the dependency ratio of 0.5 as the demarcation line between the demographic dividend period and the end of the demographic dividend period, the prediction shows that China entered the demographic dividend period in 1990, and the demographic dividend gradually increased in 1990-2010, and the dependency ratio declined to the lowest value of 34.2% and the demographic dividend rose to the peak in 2010; after that the demographic dividend gradually declined, and it will be declined to zero before and after 2030. And then shifted to the period of population debt; and then the debt ratio gradually high, 2050 dependency ratio will reach about 62%, the debt ratio will also hit a new high. Accordingly, it can be judged that the current demographic dividend period in China has not come to an end, and the next 10 years or so can still play a supporting role for economic growth, only that the support is gradually weakening. Similarly, it is necessary to make a scientific assessment of the population liability period after 2030, not only to see the total labor force shortage, structural shortages, rising costs and other negative impacts, and study how to minimize the negative impacts; but also to seek truth from facts, from China's actual situation and international experience, and to seek ways to solve the problem. Developing and utilizing the post-population dividend is a fundamental policy. Research shows that when the general demographic dividend enters the decay period, the role and contribution of human capital enhancement such as education, science, skills and experience of the working-age population to the socio-economic development will be more and more significant, and may show a strong post-demographic dividend effect. The post-demographic dividend effect can make up for the demographic defects of the decline in the proportion and absolute number of working-age population and the increase in the dependency ratio, and form a new dividend opportunity period in which the population and labor force "exchange quality for quantity". Obviously, the development and utilization of the post-demographic dividend, from now on should focus on strengthening human capital investment.