Chronicle of a Decline Foretold : Has China Reached the Lewis Turning Point? / Mitali Das, Papa N'Diaye.

Format:

Book

Government document

Author/Creator:

Das, Mitali.

Contributor:

N'Diaye, Papa.

International Monetary Fund. Research Department.

International Monetary Fund. Asia and Pacific Department.

Series:

IMF Working Papers; Working Paper ; No. 2013/026

IMF Working Papers

Language:

English

Subjects (All):

Demography--China.

Demography.

Economic development--China.

Economic development.

Physical Description:

1 online resource (22 p.)

Place of Publication:

Washington, D.C. : International Monetary Fund, 2013.

Language Note:

English

Summary:

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.

Contents:

Cover; Contents; I. Introduction; Figures; Figure 1.A. What is the Lewis Turning Point?; Figure 1.B. Economy Where Full Employment has not Been Achieved; II. Recent Developments; Figure 2. Labor Market Developments; III. Empirical Framework; Figure 3. Demographic Pressures; IV. Results; Tables; Table 1: Variable definitions and Sources; Table 2: Estimated Regression Coefficients; V. Scenario Analysis; A. Baseline Scenario; Figure 4. Estimated Excess Supply Levels; Figure 5. Labor Force, Actual and Regression Estimates; Figure 6. Baseline Scenario: Surplus Labor

Figure 7. Alternative Scenarios: Surplus LaborB. Increase in the Fertility Rate; Figure 8. Working Age Population: Constant and High Fertility; Table 3: Excess Labor Supply Scenarios (millions); C. Higher Labor Force Participation Rates; D. Financial Sector Reform; E. Product Market Reform; Figure 9. Labor Force Participation Rate; VI. Conclusion; Appendix: Derivation of Empirical Framework; References

Notes:

"January 2013."

"Research Department and Asia and Pacific Department."

Includes bibliographical references.

Description based on print version record.

ISBN:

9781475554090

1475554095

9781475525199

1475525192

9781299265073

1299265073

9781475594058

1475594054