China's Gender Imbalance and its Economic Performance

Chinese GDP growth faces rising handicaps that include the slowdown and eventual contraction of its labour force, a complication of which is its rising sex ratio at birth. The undesirable consequences of the resulting gender imbalance include excessive saving as families with boys compete to match their sons with scarce girls, trafficking in women and rising disaffection and crime amongst the low-skill male population. These are reviewed and analysed using a dynamic model of both economic and demographic behaviour. The results show that the proportion of unmatched low-skill males of reproductive age could be as high as one in four by 2030, with numbers too large for female immigration to be a solution. Policies to rebalance the sex ratio at birth will take decades to reduce the sex ratio at reproductive age and any associated allowance of higher fertility would slow growth in real per capita income. Yet the results suggest that the beneficial effects of reduced male disaffection and crime could outweigh the losses from reduced saving and higher population.