Does low birth rate affect China’s total factor productivity?

Abstract

This study uses the DEA-Malmquist method to measure total factor productivity by employing the provincial panel data from 1998 to 2017 in China and constructing a panel data model to test the relationship between birth rate and human capital and the influence of labour in different age groups on total factor productivity. It was found that the increase in the birth rate has a significantly negative effect on human capital accumulation, while the effect of the birth rate on human capital shows an inverted 'U' shape. That is, when birth rate decreases, human capital increases, and when birth rate increases, human capital decreases. Thus, too low or too high birth rates will reduce human capital. Ultimately, human capital accumulation will significantly promote the growth and decomposition of total factor productivity. The effect of the labour age structure on total factor productivity also shows an inverted 'U' shape. Labour between 40 and 49 years old contributes the most to the promotion of total factor productivity. Eventually, due to the low birth rates, the proportion of 50-59 years old will keep at high level. Therefore, total factor productivity will decline significantly.

The influence of biased technical progress on employment scale of the circulation industry: Evidence from China

“…Analyzing previous scholars' research [1,[39][40][41], we found that the factor-enhanced CES production function is used more to measure biased technical progress. The reason is that the relative marginal output change of factors in the definition of biased technical progress is not only related to the factor efficiency, but also related to the substitution elasticity between factors.…”

“…Scholars use the theory of biased technical progress to explain a series of unbalanced economic problems such as labor income gap and income distribution [9][10][11][12]. In recent years, scholars have applied biased technical progress widely, such as combining it with total factor productivity [13][14][15][16][17][18][19], economic growth [20,21], industrial structure upgrading and change [22], employment and unemployment [23,24], high-quality economic development [25]. Some scholars have also included energy into the input factor and explored the technology bias among the factor groups [26,27] and the bias of green technology progress [28].…”

Innovation factor double circulation: Cross-border mobility and the manufacturing industry’s total factor productivity

“…They find that as the technological gap substantially reduces, the improvement effect of capital-biased technological progress on industrial total factor productivity weakens, which indicates long-term dependence on large-scale capital driving is not sustainable. In other words, in seeking to effectively improve industrial total factor productivity, actors should further optimize the rational allocation of factor input between industries [12].…”

Research on China's Fertility Decline and Economic Sustainable Development

“…An aging workforce can lead to a shortage of skilled and experienced workers, affecting productivity and innovation. Older members of the labor force often face issues such as reduced enthusiasm, slower responsiveness, and diminished sensitivity [6], which can lead to a decline in workforce productivity and efficiency. The main issue concerning China's population at present is not population control policies, but rather low birth rates, along with the challenges of diminishing demographic dividend and an aging population [7].…”