How The Two-child Birth Decisions Affects Household Asset Allocation

In 2021,China’s annual number of births was 10.62 million,with a fertility rate of 7.52,the lowest since the founding of the country in 1949.At present,China is gradually falling below the severe aging population and low birth rate,and in 2013 China announced the "only child" policy for families where the couple is an only child,and in 2016 announced the "comprehensive second child" policy to encourage eligible families to raise two or more children.Research on how the reproductive decision of the second child affects the market rate and participation level of household financial risk will not only increase the in-depth study of the factors influencing family structure in the field of household finance,but will also inform national policy makers to encourage childbirth.This thesis examines the impact of second child decision-making on the participation rate and depth of participation in the financial risk market and the participation rate and depth of stock market participation in household financial asset allocation,based on the Logit,Tobit,and Probit models,using questionnaire data from the China Household Financial Survey(CHFS)conducted twice in four years in 2017 and 2019.This thesis has the following conclusions:the decision to have a second child will increase the probability and depth of family participation in financial risk market investment,and will also increase the probability and depth of family participation in stock market investment.In sandwich families that need to support both parents and children,the economic pressure of supporting the elderly will further amplify the impact of the decision to have two children on the participation of financial asset risk markets.At the same time,compared with families in the western region,the impact of the decision to have a second child on the participation of financial asset risk market is more significant in the families in the central and eastern regions.Consumption and debt will play an intermediary role in the decision-making of two-child birth to improve the probability and degree of financial allocation of families,and indirectly promote the probability and degree of financial allocation of families.In 2021,China’s annual number of births was 10.62 million,with a fertility rate of 7.52,the lowest since the founding of the country in 1949.At present,China is gradually falling below the severe aging population and low birth rate,and in 2013 China announced the "only child" policy for families where the couple is an only child,and in 2016 announced the "comprehensive second child" policy to encourage eligible families to raise two or more children.Research on how the reproductive decision of the second child affects the market rate and participation level of household financial risk will not only increase the in-depth study of the factors influencing family structure in the field of household finance,but will also inform national policy makers to encourage childbirth.This thesis examines the impact of second child decision-making on the participation rate and depth of participation in the financial risk market and the participation rate and depth of stock market participation in household financial asset allocation,based on the Logit,Tobit,and Probit models,using questionnaire data from the China Household Financial Survey(CHFS)conducted twice in four years in 2017 and 2019.This thesis has the following conclusions:the decision to have a second child will increase the probability and depth of family participation in financial risk market investment,and will also increase the probability and depth of family participation in stock market investment.In sandwich families that need to support both parents and children,the economic pressure of supporting the elderly will further amplify the impact of the decision to have two children on the participation of financial asset risk markets.At the same time,compared with families in the western region,the impact of the decision to have a second child on the participation of financial asset risk market is more significant in the families in the central and eastern regions.Consumption and debt will play an intermediary role in the decision-making of two-child birth to improve the probability and degree of financial allocation of families,and indirectly promote the probability and degree of financial allocation of families.