Household Demographic Structure And Household Risky Financial Assets Choice

Since the reforming and opening up,Chinese economy has experienced fast growth,national income and residents’ living standard has increased significantly.The development of financial markets and the diversification of financial products contribute to the prosperity of financial markets.As a vital part of national economy,family plays an important role in whole society and economy that can’t be ignored.From 1970’s to 2016,China’s family planning policy has drastically changed whole social population structure,and these changes impact industrial structures,economic development and the residents’ life style.Household finance is a whole new field of research,but it draw much attention from more and more scholars,especially in the choices of household financial assets.We can classify these factors into three groups: demographics factors,back-risk factors and other factors.Demographics factors contain age,gender,marriage,education and so on;back-risk factors contain health risk,house risk and labor income risk;other factors contain residents’ attitude,social trust,and overall economic environment etc.In the respect of the family demographic structure influences on household financial assets choices,previous studies mainly focus on the age of householder,the old-age dependency rate or child-age dependency rate.This dissertation chooses four variables: householders’ age,household size,the old-age ratio and child-age ratio as the substitution variable of family demographic structure.This dissertation divided household financial assets into two types: safe financial assets and risky financial assets.Risky financial assets and stock asset are our main study objects.Before the empirical study,this dissertation thoroughly described the present situation about the demographic structure and household financial asset in our country.Firstly,the figures shows China had entered an aging society early at 1999,and the elderly dependency ratio has reached on 14.3% at 2015.Since the family planning had been adopted,the fertility rate become lower and lower,and it is only 1.18 in recent years.The proportion of children whose age is not over 14 in total population is about 16.5% at 2015.Miniaturization is the main trend of family scale.Every family just have 3.35 members in average.At the same time,the data from China Household Finance Survey(CHFS)coincide with the official statistics.Generally,population aging,low birth-rate and smaller family scale are the characteristics of family demographic structure.Next,this dissertation described the household financial assets present situation,by using both macro and micro data.From the respect of gross amount,structure and financial market participate rate,combing two sources of data,we find the characteristics of China household financial assets are as follows: the total household financial assets continued to increase;the portfolio model from the single to a direction,making the financial structure more optimized;although the absolute proportion descends a little,deposits still dominate.High-risky financial assets ranked two after deposits,it reflects there are many defects in household financial assets portfolio.When it comes to empirical analysis,this dissertation use the micro data from CHFS at 2013.Firstly,we illustrate the theoretical foundation of this study,including Modern Portfolio Theory,Life-Cycle Theory and back-risk Theory.Then,we set variables that include independent variables,dependent variables and control variables.We use Probit model and Tobit model to analyze the demographic structure’s influence on the probability of investing in the risky financial markets and stock market,the proportion of risky financial assets and stock assets.We show the regression results and give detailed explanation.Next,we analyze the influences’ heterogeneity of different regions by using sub-samples.Furthermore,this paper made the robustness examination.This dissertation’s conclusions are as follows: 1.We find that the structure of household risky financial assets has obviously life-cycle characteristics,showing an inverse “U” shape;2.The big family scale will increase their burden,causing less risky financial assets;3.The old-age ratio has positive impact on household risky assets portfolio,but large differences exit;4.The child-age ratio has positive influence on households’ risky financial portfolio too,and has greater effect than the old-age ratio;5.The level of education of the householders affected the household financial assets choice: the higher the education level of householders,the more the probability and proportion of risky financial assets;6.Other factors affect household financial assets choice including: householder’s gender,marital status,risk attitude,and family income,house,proprietary business and so on;7.There are tremendous differences between urban and rural,between east,middle and west.In final,comprehensively considered conclusions,the feature of household financial assets,as well as our economic environment,and the family structure at this stage,several suggestions were proposed respectively to government sectors,financial institutions and residential household.For government sectors,1.The state shall consummate and perfect social insurance system such as the basic old-age insurance,basic health insurance,birth insurance,public welfare and other social security system to promote family planning;2.The department concerned ought to distribute educational resources more rationally to help reduce the family burden;3.Government shall enforce the spreading of financial literacy and improve the structure and efficiency of the financial market;4.Government shall timely to raise the income level of households to increase their net worth that can be used for investment.Meanwhile,it’s significant to narrow the wealth gap between the rich and the poor.5.Government should support western and rural areas to improve their financial environment.Next for the financial institutional,financial institution should design financial products and provide financial services that can meet family’s different demand.Finally for the residential households,residents should enhance their own financial investment skill,so that they can optimize the structure of household financial assets and increase investment income.The main contributions of this dissertations include: the one is the data source: compared with other data source in previous studies,the data from CHFS at 2013 is more representative and scientific;the other is explanatory variables: we set four independent variables to present family demographic structure not just use age or elderly dependency ratio and child dependency ratio.