The Impact Of Population Fertility Policy On Residents' Saving Rate In China

Since the founding of our country,population issue has always been the major concern of our government and citizens.In the early days of our country,our government encouraged childbirth believing that there is strength in large number of population,thus dramatically booming our overall population as well as population growth rate.With emergences of some population problems,the country started facing the reality of population inflation and gradually carrying out the family planning policy.The government tried to restrict citizens' fertility through administrative orders,laws,and regulations,hoping the one child policy could control the population growth rate.The over 30 years' family planning has successfully controlled the population growth of our country,but also left several issues behind,such as the decline in both the number and proportion of working-age population,and the aging of overall population.These problems could be hidden troubles behind the future development of economy and society of our country.In the meanwhile,China's exceptionally high saving ratio is also a hot topic for Chinese and oversea scholars.High saving ratio provided our country with adequate investment capital and motivation during the early stage of economic development.But with the economy maturing over time,the high saving ratio has turned into an unhealthy ‘high income,high saving,but low consumption‘ pattern,which will adversely effect on promoting domestic demand.This pattern is criticized by Justin Lin,the former World Bank Chief.For our country pursuing sustainable development and green economy,the current situation needs to be adjusted and improved.According to those two problems mentioned above,this paper creatively combines the population policy and the household saving ratio of citizens.This paper first goes through related demographic theory and saving theory,then summarizes the development of our country's population policy and its influence on the changes in population number and household savings,makes further theoretical analysis based on current situation,exploring how the population policy will influence household savings,and finally draws the conclusion through empirical analysis.This paper hopes to find the correlation between population policy and household saving ratio,and explore what influences that differences in population policy will have onpopulation growth and household saving ratio.This paper also tries to bring up with a new way to reduce the relatively high saving ratio,and come up with feasible qualitative and quantitative measures.Combining the analyses of related theories,population policies,population growth,and changes in household saving,this paper gets the mechanism of how the population policy affects household savings:population policies have direct impacts on age structure of population.The positive impacts are that population policies dramatically increase population quality,rapidly decrease the total fertility rate,indirectly boost the economy,and generally mitigate the supply-demand conflict.The positive impact includes that the aging population trend aggravates,the number of working-aged population decreases,causes conflicts between population policies and fertility desire.And the change in aging structure of the population further influences the household saving ratio of our country by changing the labor supply,income distribution and societal expectations.This paper summarizes the population policies in different areas of our country since the Chinese economic reform,and conducts empirical analysis on the influence of different population policies on household saving ratio in different areas.Combined with the cross-sectional data from 1991-2202 of our country,the analysis conducts several measures,such as dummy variance VIF test,random utility model and white heteroscedasticity robust standard errors.Based on the content above,this The analysis documents that restrictive population policies have positive impacts on household saving ratios,while loose population policies have negative impacts,that the changes in children's dependency ratio and elder people's dependency ratio have negative and positive influence respectively,and that the growth rates of both urban citizen's per capital and rural resident's per capital have positive influence on household saving ratios,but the influence is not significant.The interest rates has significant influence on household saving ratio,while the growth rate of GDP does not.paper draws the conclusion that looser population policies could reduce the household saving ratio in our country,decrease the precautionary saving,improve the population quality,maintain the social stability,and promote the development of economy and society.This paper comes up with four suggestions:(1)a further relaxation of the family planning policy,the social status from the source to change the current policy of birth control,to improve the fertility rate and improve the quality of reproduction,thus affecting the age structure of the population in thefuture and the quality of the population;(2)the establishment of a more perfect old-age insurance system,from the angle of social welfare to provide more protection for the elderly population.The elderly living so that they have better expectations,not consumption into savings for the risk prevention;(3)increase the labor capital investment,the quantity and quality of labor supply double increase,makes our country high household savings can be effectively transformed into investment;(4)the change of consumption concept and savings the idea,especially the change of elderly population consumption and saving habits,eliminate dependence on savings from the aspect of culture.