Pub Date : 2013-01-01DOI: 10.5089/9781475548242.001
M. Das, Papa N’Diaye
China is on the eve of a demographic shift that will have profound consequences on its economic and social landscape. Within a few years the working age population will reach a historical peak, and then begin a precipitous decline. This fact, along with anecdotes of rapidly rising migrant wages and episodic labor shortages, has raised questions about whether China is poised to cross the Lewis Turning Point, a point at which it would move from a vast supply of low-cost workers to a labor shortage economy. Crossing this threshold will have far-reaching implications for both China and the rest of the world. This paper empirically assesses when the transition to a labor shortage economy is likely to occur. Our central result is that on current trends, the Lewis Turning Point will emerge between 2020 and 2025. Alternative scenarios-with higher fertility, greater labor participation rates, financial reform or higher productivity-may peripherally delay or accelerate the onset of the turning point, but demographics will be the dominant force driving the depletion of surplus labor.
{"title":"Chronicle of a Decline Foretold: Has China Reached the Lewis Turning Point?","authors":"M. Das, Papa N’Diaye","doi":"10.5089/9781475548242.001","DOIUrl":"https://doi.org/10.5089/9781475548242.001","url":null,"abstract":"China is on the eve of a demographic shift that will have profound consequences on its economic and social landscape. Within a few years the working age population will reach a historical peak, and then begin a precipitous decline. This fact, along with anecdotes of rapidly rising migrant wages and episodic labor shortages, has raised questions about whether China is poised to cross the Lewis Turning Point, a point at which it would move from a vast supply of low-cost workers to a labor shortage economy. Crossing this threshold will have far-reaching implications for both China and the rest of the world. This paper empirically assesses when the transition to a labor shortage economy is likely to occur. Our central result is that on current trends, the Lewis Turning Point will emerge between 2020 and 2025. Alternative scenarios-with higher fertility, greater labor participation rates, financial reform or higher productivity-may peripherally delay or accelerate the onset of the turning point, but demographics will be the dominant force driving the depletion of surplus labor.","PeriodicalId":368819,"journal":{"name":"PSN: Population (Topic)","volume":"94 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2013-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131093343","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In recent decades, most industrialized countries experienced declining population growth rates caused by declining fertility and associated with rising life expectancy. We analyze the effect of continuing demographic change on medium- and long-run economic growth by setting forth an R&D-based growth model including an analytically tractable demographic structure. Our results show that, in response to demographic change, technological progress and economic growth accelerate in the medium run but slow down in the long run. Numerical investigation reveals that the time period during which technological progress and economic growth are faster than without demographic change can be very long. Since the theoretical predictions for the medium run are consistent with the negative association between population growth and economic growth found in the empirical literature, the present framework can reconcile R&D-based growth theory with the available empirical evidence.
{"title":"Demographic Change and R&D-Based Economic Growth: Reconciling Theory and Evidence","authors":"Timo Trimborn, K. Prettner","doi":"10.2139/ssrn.2141191","DOIUrl":"https://doi.org/10.2139/ssrn.2141191","url":null,"abstract":"In recent decades, most industrialized countries experienced declining population growth rates caused by declining fertility and associated with rising life expectancy. We analyze the effect of continuing demographic change on medium- and long-run economic growth by setting forth an R&D-based growth model including an analytically tractable demographic structure. Our results show that, in response to demographic change, technological progress and economic growth accelerate in the medium run but slow down in the long run. Numerical investigation reveals that the time period during which technological progress and economic growth are faster than without demographic change can be very long. Since the theoretical predictions for the medium run are consistent with the negative association between population growth and economic growth found in the empirical literature, the present framework can reconcile R&D-based growth theory with the available empirical evidence.","PeriodicalId":368819,"journal":{"name":"PSN: Population (Topic)","volume":"14 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2012-09-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"114347695","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The idea of a housing deficit is a common, seemingly objective frame for housing policies. A deficit of between 3 and 8 million units in Indonesia has become a concern for the government in recent years. The wide range of estimates demonstrates not only that the methods used to estimate housing need are inconsistent, but also that the meaning of the term housing deficit is little understood. Insufficient housing supply is generally blamed for the supposed deficit, and policies to stimulate housing production have been considered in response. This paper analyzes household formation trends in urban Indonesia from 1990 to 2007 and estimates the quantitative housing deficit based on trends. The analysis finds that an abrupt change in the rate of household formation and household size occurred in Indonesia around the year 2000, suggesting that beyond macro trends in the country’s demographic transition and urbanization, the economic and political upheavals in the last years of the 20th century affected household formation significantly. Yet, analysis of household formation over different socioeconomic groups and urban areas shows that housing markets do also matter.
{"title":"Demographic Transition, Economic Crisis and the Housing Deficit in Indonesia","authors":"Paavo Monkkonen","doi":"10.2139/ssrn.1991853","DOIUrl":"https://doi.org/10.2139/ssrn.1991853","url":null,"abstract":"The idea of a housing deficit is a common, seemingly objective frame for housing policies. A deficit of between 3 and 8 million units in Indonesia has become a concern for the government in recent years. The wide range of estimates demonstrates not only that the methods used to estimate housing need are inconsistent, but also that the meaning of the term housing deficit is little understood. Insufficient housing supply is generally blamed for the supposed deficit, and policies to stimulate housing production have been considered in response. This paper analyzes household formation trends in urban Indonesia from 1990 to 2007 and estimates the quantitative housing deficit based on trends. The analysis finds that an abrupt change in the rate of household formation and household size occurred in Indonesia around the year 2000, suggesting that beyond macro trends in the country’s demographic transition and urbanization, the economic and political upheavals in the last years of the 20th century affected household formation significantly. Yet, analysis of household formation over different socioeconomic groups and urban areas shows that housing markets do also matter.","PeriodicalId":368819,"journal":{"name":"PSN: Population (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2012-01-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128755778","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We investigate the effect of population aging on international factor flows in a political-economy framework. Political barriers to immigration in developed countries and insecure property rights in developing countries impede factor flows. Taking into account different generations’ conflicting attitudes towards immigration and expropriation, we explore how these policy barriers interact. We find that incentives to expropriate increase as more emigration from the developing country takes place. Meanwhile, the industrialized country admits less immigrants as less capital is allocated to the developing country. Furthermore, the effects of population aging on international factor flows are considerably underestimated if one does not take into consideration the interactions between immigration and expropriation policies.
{"title":"Demographics and Factor Flows – A Political Economy Approach","authors":"Philipp an de Meulen, Lena Calahorrano","doi":"10.2139/ssrn.1969773","DOIUrl":"https://doi.org/10.2139/ssrn.1969773","url":null,"abstract":"We investigate the effect of population aging on international factor flows in a political-economy framework. Political barriers to immigration in developed countries and insecure property rights in developing countries impede factor flows. Taking into account different generations’ conflicting attitudes towards immigration and expropriation, we explore how these policy barriers interact. We find that incentives to expropriate increase as more emigration from the developing country takes place. Meanwhile, the industrialized country admits less immigrants as less capital is allocated to the developing country. Furthermore, the effects of population aging on international factor flows are considerably underestimated if one does not take into consideration the interactions between immigration and expropriation policies.","PeriodicalId":368819,"journal":{"name":"PSN: Population (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127416360","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article analyses rural depopulation in Japan and its implications by means of a case study of Niigata Prefecture and Sado Island. In the first part of the article, we present population maps to show that rural demographic shrinkage is both deepening as well as broadening to include urban centres. We focus initially on Niigata Prefecture in the national context and then discuss migratory patterns in Sado. The data show that Sado, and now Niigata Prefecture as a whole, have entered what we call a ‘double-negative population disequilibrium’, whereby both the migratory and natural reproduction population contributions have turned negative. Recent evidence indicates that Niigata City itself may also have begun to shrink. In the second part, we discuss the implications of depopulation for Sado Island via extracts from qualitative interviews gathered from local residents. We found that many residents now accept the inevitability of continued shrinkage and, rather than seeking to re-establish growth, many institutional and social and environmental entrepreneurs are instead working towards achieving community stability and sustainability. We conclude by suggesting that the example of Japan's rural communities presents Japan's regional cities with the occasion to consider life ‘beyond growth’, as their populations also begin to shrink in the years to come.
{"title":"Coming Soon to a City Near You! Learning to Live 'Beyond Growth' in Japan's Shrinking Regions","authors":"P. Matanle, Yasuyuki Sato","doi":"10.1093/SSJJ/JYQ013","DOIUrl":"https://doi.org/10.1093/SSJJ/JYQ013","url":null,"abstract":"This article analyses rural depopulation in Japan and its implications by means of a case study of Niigata Prefecture and Sado Island. In the first part of the article, we present population maps to show that rural demographic shrinkage is both deepening as well as broadening to include urban centres. We focus initially on Niigata Prefecture in the national context and then discuss migratory patterns in Sado. The data show that Sado, and now Niigata Prefecture as a whole, have entered what we call a ‘double-negative population disequilibrium’, whereby both the migratory and natural reproduction population contributions have turned negative. Recent evidence indicates that Niigata City itself may also have begun to shrink. In the second part, we discuss the implications of depopulation for Sado Island via extracts from qualitative interviews gathered from local residents. We found that many residents now accept the inevitability of continued shrinkage and, rather than seeking to re-establish growth, many institutional and social and environmental entrepreneurs are instead working towards achieving community stability and sustainability. We conclude by suggesting that the example of Japan's rural communities presents Japan's regional cities with the occasion to consider life ‘beyond growth’, as their populations also begin to shrink in the years to come.","PeriodicalId":368819,"journal":{"name":"PSN: Population (Topic)","volume":"14 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2010-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130735728","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
A two-sector general equilibrium model has been developed where the inelastically supplied male labor is used in both sectors, but the elastically supplied female labor is used only in the shadow economy. Women's economic participation involves a welfare loss in addition to the usual disutility from work as it conflicts with the existing social values and limits their access to the informal credit market involving neighbors, friends and relatives. The model disentangles the economic and welfare effects of the credit and non-credit based institutional interventions as observed in many developing countries. The finding suggests that microfinance, if not coupled with women's empowerment, may in fact result in only a zero sum game involving an increase of the percentage share of the shadow economy at the cost of the formal sector. The result also contests the conjectures of the existing literature that high economic growth will ultimately reduce the size of the shadow economy over time. Rather it shows that microfinance can increase the share of the informal sector even in a growing economy. Given the cognition of the literature that a large shadow economy can limit the provision of public goods, the finding of this paper is important for the donor agencies who are euphorically pouring funds for microcredit programs.
{"title":"Prying into the Shadows: A General Equilibrium Model to Analyze the Effects of the Emerging Institutions on the Structure of Production and Welfare in Developing Countries","authors":"M. A. Basher","doi":"10.2139/ssrn.1014646","DOIUrl":"https://doi.org/10.2139/ssrn.1014646","url":null,"abstract":"A two-sector general equilibrium model has been developed where the inelastically supplied male labor is used in both sectors, but the elastically supplied female labor is used only in the shadow economy. Women's economic participation involves a welfare loss in addition to the usual disutility from work as it conflicts with the existing social values and limits their access to the informal credit market involving neighbors, friends and relatives. The model disentangles the economic and welfare effects of the credit and non-credit based institutional interventions as observed in many developing countries. The finding suggests that microfinance, if not coupled with women's empowerment, may in fact result in only a zero sum game involving an increase of the percentage share of the shadow economy at the cost of the formal sector. The result also contests the conjectures of the existing literature that high economic growth will ultimately reduce the size of the shadow economy over time. Rather it shows that microfinance can increase the share of the informal sector even in a growing economy. Given the cognition of the literature that a large shadow economy can limit the provision of public goods, the finding of this paper is important for the donor agencies who are euphorically pouring funds for microcredit programs.","PeriodicalId":368819,"journal":{"name":"PSN: Population (Topic)","volume":"45 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2007-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124731971","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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