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Population Ageing And Labour Supply Prospects In China From 2005 To 2050

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  • Xiujian Peng
  • Dietrich Fausten

Abstract

Increasing life expectancy and rapid fertility decline in China since the 1970s have accelerated the rate of population ageing, fuelling the prospects of an ageing workforce and a significant slowdown in the growth of the working age population. The present paper examines the trend of labour supply in China over the next 45 years under alternative fertility scenarios by taking account of the demographic composition effect and potential trends of the age-and sex-specific labour force participation rates. The main finding is that the labour supply contraction will accelerate from 2020 onwards in response to population ageing and the probable attrition of the LFPR of the young population. Relaxing the current one-child policy may moderate the adverse labour market consequences by increasing the base of the working age population and decelerate the rate of population ageing.

Suggested Citation

  • Xiujian Peng & Dietrich Fausten, 2006. "Population Ageing And Labour Supply Prospects In China From 2005 To 2050," Monash Economics Working Papers 16/06, Monash University, Department of Economics.
  • Handle: RePEc:mos:moswps:2006-16
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    File URL: http://www.buseco.monash.edu.au/eco/research/papers/2006/1606ageingandlabour.pdf
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    References listed on IDEAS

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    1. Creina Day & Steve Dowrick, 2004. "Ageing Economics: Human Capital, Productivity and Fertility," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 11(1), pages 3-20.
    2. Bloom, David E & Williamson, Jeffrey G, 1998. "Demographic Transitions and Economic Miracles in Emerging Asia," World Bank Economic Review, World Bank Group, vol. 12(3), pages 419-455, September.
    3. Dave Turner & Claude Giorno & Alain de Serres & Ann Vourc'h & Pete Richardson, 1998. "The Macroeconomic Implications of Ageing in a Global Context," OECD Economics Department Working Papers 193, OECD Publishing.
    4. Bob Dugan & Benoît Robidoux, 1999. "Demographic Shifts and Labour Force Participation Rates in Canada," A Symposium on Canadian Labour Force Participation in the 1990s (Special Issue of Canadian Business Economics, Volume 7, Number 2, May 1999), in: Andrew Sharpe & Louis Grignon (ed.),A Symposium on Canadian Labour Force Participation in the 1990s (Special Issue of Canadian Business Economics, Volume 7, Number 2, May 1999), pages 42-56, Centre for the Study of Living Standards.
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    Cited by:

    1. Xinxin Wang & Kevin Z Chen, 2016. "Will China’s Demographic Transition Exacerbate Its Income Inequality? A CGE Modeling with Top-down Microsimulation," Working Papers id:11406, eSocialSciences.
    2. Xinxin Wang & Kevin Z. Chen & Sherman Robinson & Zuhui Huang, 2017. "Will China's demographic transition exacerbate its income inequality?–CGE modeling with top-down microsimulation," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 22(2), pages 227-252, April.

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    More about this item

    Keywords

    population ageing; labour supply and China;

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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