An economic thread

Calm down Aerodriver and Vince/Yue a little more civility and humility in your dealings with your fellow forum members please.

You both have valid points to make and if you take the time to examine both views you will make an interesting discovery.

You are right Aerodriver, that the current trend, unattended would result in a relative Labour shortage by the middle of the Century. It is however; as Vince was trying to point out, a little like saying "I am slowly driving my car into the garage, if I continue to drive, I will; within a minute, have collided with my Garages rear wall" a factually correct statement, but one which few people would be foolish enough to continue to its end in practice.

This comes to the interesting point, which is not so much what the article says, but where it is written - in a State Controlled Newspaper and well known CCP Mouthpiece.

Family Planning has been a major social policy in China for decades and no modern Government anywhere in the world, would wish to be seen to be changing a major policy in an arbitary or abrupt manner. This is especially true for a policy which affects so many people in so fundamental a manner. Afterall, how can something that was so wrong for so long, suddenly be Ok and even encouraged?

I think we can safely assume that the CCP realises that demographic rebalancing is necessary and that now is the time to initiate that change. The Govt, however must present a case to the people to explain that needs and circumstances have changed and thatpolicy must as well.

I hope that we will see changes that favour the growth of the middle class and which enable natural economic and aspirational factors to control family size. The importantfact is that now there is an Urban Middle Class capable of rectifying the Demographic Imbalance, without producing another glut of povety trapped subsistance farmers.

I have a feeling we will learn Mr Hu's mind fairly soon.

Baibar of Jalat said:

however it is not all doom. Chinese government could in future reverse the one child policy. with the oppurtunity for couples esp in urban areas have the ability to have more children i am 100% sure most couples would have more then the one child, for a variety of reasons. Also the use of economic benefits such as in France where families are given a few hundred euros evey month for the first year of a new childs life and other lucrative long term benefits. Has led to a significant increase in French population growth.
OR
immigration could be encouraged especially from countries in South East Asia.
The first option i believe willl be best.

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Hi Baibar,

If you look at the demographics and birth rate trends of urban cities in East Asia, you'd note that as the standard of living rises, the birth rate falls to far below replacement level. For an example:

Singapore birth rate: 1.24 per women
Hong Kong "total birth rate": 0.91 per women
Hong Kong "local birth rate" (excluding mainlanders): 0.76 per women
Macao birth rate: 0.9 per women
Taiwan "total birth rate": 1.24 per women
Taipei City area birth rate: 1.1 per women
South Korea birth rate: 1.17 per women
Japan birth rate: 1.29 per women
etc.

None of the above mentioned places have government imposed birth control. Statistics show that urban cities tend to have lower birth rates than the national average. If memory serves, Japan's total fertility rate is 1.29/women vs. ~1.0 in Tokyo city area. Now let's look at China:


The same pattern exists in China where cities like Shanghai have lower birth rate than rural areas.

IMO with trends like this, it doesn't make sense to impose birth control policy in ubran cities. As matter of fact, by removing those restrictions you might not even increase the birth rate in cities. So, you're stuck with below replacement level birth rate anyway.

As for immigration, China has a large pool of rural population to draw upon. If that's not enough they can bring immigrants from Vietnam, Thailand, Taiwan (!), or even Russia. In Shanghai area along there is estimated 600,000 Taiwanese immigrant ppopulation.

As for immigration, China has a large pool of rural population to draw upon. If that's not enough they can bring immigrants from Vietnam, Thailand, Taiwan

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Hi ADEPTITUS

sorry i also meant East Asia and South East Asia. Countries such as indonesia, Laos, Burma, philophines etc included stated Vietnam. Even in western China the gov can consider letting in Pakistani due to the growing trade links.

However Fairthought is saying thirty five years down line when the pop will needs new labour, thats what i am basing my assertions on. Also the government to increase domestic population through making children more of a fanacial asset rather then a liability. Through tax essentives etc. If does not want foriegn immigrants. But i understand what u are saying.

Thank you all for sharing your ideas on this thread. In particular, I would like to thank aerodriver for contributing some fascinating information.

However, I do not think that many of you completely grasped what I was talking about. China's current industrial boom benefits greatly from a labor surfeit. I never claimed that China's labor pool was going to dry up. I said the surfeit was going to dry up. This occurs as China's economy continues to switch from agricultural jobs to industrial jobs. Historically, this has happened in every country that has undergone industrialization. This causes growing pains. But eventually, these countries will reach a labor supply/demand equillibrium. Until then, there is social strain from the large number of dissatisfied workers.

So long as there is a labor glut, industrialists can enjoy great profits while laborers suffer extreme hardship. But as the excess labor pool dwindles, workers can demand higher pay, and safer working conditions. This can only come about through strikes, sit-ins, and public protests. This becomes a political challenge for China because the Chinese government effectively outlaws any and all labor strikes.

I did not claim that china's workforce demographics was linear. It is certainly more complicated than that. But in order to obtain a very conservative estimate, I used a conservative linear model to find when the labor strain would occur at the latest. Of course, I expect it to occur much sooner than 2035, perhaps decades sooner.


Finally, Vincelee, with regards to your comment:

why don't you just stick to liberal arts?

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The field of Economics happens to be a liberal arts major. Not that I'm trying to belittle your intelligence, I just thought you'd appreciate this.