Research On Population Structure Change And Financial Asset Price

This paper demonstrates the theoretical and empirical basis of the effect on the volatility of financial asset price, cause by the changes in the demographic structure,through extensive literature review. This paper establishes a dynamic panel sample includes 29 countries, 26 year. This paper use the stock price index as the explanatory variables, all ages’ population percentage as the explanatory variables. And use the economic development level, economic growth rate and inflation rate as control variables. This paper applies the system GMM method(SYS-GMM) and bias-corrected least squares dummy variables(BC-LSDV) method simultaneously to estimate the dynamic panel data. By applying different estimation methods and grouping estimate, this paper verifies the robustness of the estimation results.This comes out with three main conclusions: First,demographic structure’s investment effect does exist, there is a positive relationship between the proportion of the labor force and financial asset prices. Second,demographic structure’s investment effectlags in the in developing countries.In the results of sub-sample estimates of developing countries,the over-65-years ratiosignificantlyhas anegative correlationwith stock prices.Third,Chinese demographic structure’s investment effect existssignificantly, the proportion of 45-64 year-olds and stock prices were positively correlated, and the proportion of people aged over 65 stock price index was significantly negatively correlated.Based on the literature review, factanalysis and empirical analysis, this paper presents four policy recommendations: First,adapt the birth policy rationally.Second, further improve our pension and health care system. Third, accelerate the development of capital markets. Final, increase the investment in education area.