Studying the Economic Implications of Population Aging and Negative Growth in China: Challenges and Countermeasures

Bingtong Liu ()
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Bingtong Liu: No. 9 High School

A chapter in Proceedings of the International Workshop on Navigating the Digital Business Frontier for Sustainable Financial Innovation (ICDEBA 2024), 2025, pp 208-220 from Springer

Abstract: Abstract Using a neoclassical growth model, this paper examines the economic impact of population aging and negative population growth rate at national levels in China from three perspectives: labor supply-demand relationship, inter-industrial structure variations and or fiscal sustainability. Using a combination of U.S. national demographic trends and case studies from other countries, the research identifies two major challenges: labor force contraction as population growth slows in all developed nations; and rising fiscal pressures on governments due to an aging-population overhang that will tend (in normal macroeconomic conditions) to slow near-term economic growth rates everywhere. The study also compares the efficacy of different policy responses taken by other countries, to offer suggestions for China. They suggest reforms in education, changes to retirement age policies and improvements of social support systems. The results underline the importance of taking positive policy measures to alleviate economic pressures arising from demographic shifts so as to achieve continued development in China.

Keywords: Population Aging; Negative Population Growth; Industrial Structure; Fiscal Sustainability; Demographic Trends (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-652-9_22

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DOI: 10.2991/978-94-6463-652-9_22

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