NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Xi Zhu

Antai College of Economics & Management
Shanghai Jiao Tong University
Antai Building
535 Fahuazhen Road, Shanghai, China
200052

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NBER Working Papers and Publications

June 2013Intergenerational Transfer, Human Capital and Long-term Growth in China under the One Child Policy
with John Whalley, Xiliang Zhao: w19160
We argue that the demographic changes caused by the one child policy (OCP) may not harm China's long-term growth. This attributes to the higher human capital induced by the intergenerational transfer arrangement under China's poor-functioning formal social security system. Parents raise their children and depend on them for support when they reach an advanced age. The decrease in the number of children prompted by the OCP resulted in parents investing more in their children's educations to ensure retirement consumption. In addition, decreased childcare costs strengthen educational investment through an income effect. Using a calibrated model, a benchmark with the OCP is compared to three counterfactual experiments without the OCP. The output under the OCP is expected to be about 4 percent ...

Published: Zhu, Xi & Whalley, John & Zhao, Xiliang, 2014. "Intergenerational transfer, human capital and long-term growth in China under the one child policy," Economic Modelling, Elsevier, vol. 40(C), pages 275-283. citation courtesy of

 
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