Has two-child pol­icy had the de­sired ef­fect?

China Daily (Canada) - - VIEWS -

As the two-child pol­icy ap­proaches its first birth­day, com­men­ta­tors and the Chi­nese govern­ment are look­ing for ev­i­dence to see whether it has had the de­sired ef­fect: an in­crease in the birth rate in or­der to mit­i­gate some of the ef­fects of ag­ing pop­u­la­tion.

At first glance, the ev­i­dence seems to be promis­ing. It is es­ti­mated that there will be around 17.5 mil­lion births in 2016. At over one mil­lion more than in 2015 one might say the two-child pol­icy has been a suc­cess. With­out doubt, many cou­ples have seized the op­por­tu­nity to have a sec­ond child, re­al­iz­ing both a per­sonal dream and a fa­vor­able out­come for the coun­try. How­ever, there are a few­words of cau­tion.

Firstly, as the Year of the Sheep, 2015 was widely per­ceived to be a not-so-good year to have chil­dren. Nu­mer­ous stud­ies have said the in­flu­ence of the zo­diac is still strong among the Chi­nese. It is likely, then, that many would-be par­ents may have sim­ply post­poned hav­ing chil­dren in 2015, choos­ing in­stead to have ba­bies in the more fa­vor­able Year of theMon­key. In­deed, if we look at the longer-term trends, the num­ber of births in 2015 ac­tu­ally fell from 2014.

Sec­ondly, we still do not know the to­tal im­pact of what de­mog­ra­phers call the “tempo ef­fect”. As coun­tries de­velop and, es­pe­cially, as ed­u­ca­tional and em­ploy­ment op­por­tu­ni­ties for women grow, child­bear­ing tends to be post­poned. As this has hap­pened in most low fer­til­ity coun­tries, we can ex­pect this to have hap­pened in China, too. The prob­lem, how­ever, is that this ef­fect tends to dis­tort the to­tal fer­til­ity rate, usu­ally ex­ag­ger­at­ing both baby busts and baby booms. Also, sim­ply count­ing the num­ber of births tells us very lit­tle about the birth rate, as this is go­ing to be af­fected by the num­ber who are “at risk” of hav­ing chil­dren. In China, of course, this is go­ing to be re­lated not just to be­ing of re­pro­duc­tive age, but also to mar­i­tal sta­tus.

Tak­ing these el­e­ments to­gether, there­fore, we have to con­clude that it is just too soon to say whether or not these changes in fam­ily plan­ning are hav­ing the de­sired ef­fect. We will know more in a few more years when we have bet­ter pe­riod data with which we can iden­tify a trend. In re­al­ity, though, it is only when the co­horts born in the 1980s and 1990s have com­pleted their child­bear­ing will we see the true de­mo­graphic im­pact of the pol­icy change.

Two fi­nal notes of cau­tion. The ev­i­dence seems to sug­gest that chang­ing the fam­ily plan­ning pol­icy alone will not be enough to make a sig­nif­i­cant dif­fer­ence to the fer­til­ity rate. As else­where in East Asia, con­cerns about jobs, so­cial wel­fare, cost of liv­ing, hous­ing, kin­der­garten ac­cess, gen­der eq­uity and so on have as much im­pact upon the de­ci­sion to limit child­bear­ing as fam­ily plan­ning pol­icy. Al­le­vi­at­ing these con­cerns is crit­i­cal to in­creas­ing China’s low fer­til­ity rate.

Sec­ondly, it is crit­i­cal to re­mem­ber that rais­ing the birth rate alone is not the only an­swer to man­ag­ing China’s ag­ing pop­u­la­tion. In­deed, in the short term, it would in­crease the bur­den on the work­ing age pop­u­la­tion by ne­ces­si­tat­ing an in­creased num­ber school places and the with­drawal of par­ents from the la­bor mar­ket to care for these chil­dren. Rather, China needs to take a holis­tic ap­proach to this de­mo­graphic chal­lenge, and will have to deal with both the de­nom­i­na­tor and the nu­mer­a­tor. On the one hand, im­prov­ing la­bor pro­duc­tiv­ity, mov­ing up the value chain of in­no­va­tion, in­creas­ing la­bor force par­tic­i­pa­tion, fur­ther re­form­ing the State-owned en­ter­prises and de­vel­op­ing the global la­bor sup­ply chain through the Silk Road Eco­nomic Belt and the 21st Cen­tu­ryMar­itime Silk Road will be crit­i­cal to max­i­miz­ing out­put. On the other hand, re­form­ing and de­vel­op­ing bet­ter so­cial wel­fare sys­tems for the el­derly as well as mak­ing progress in ac­tive ag­ing poli­cies will not only de­crease the de­pen­dence of the older pop­u­la­tion, but could also free up the monies ac­crued as a re­sult of high per­sonal sav­ings rates and, hence, spur do­mes­tic con­sump­tion.

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