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The Third Plenum eases the one-child policy

November 21, 2013

Last week, China's Third Plenum announced that it would ease the one child policy allowing millions of people to have a second child. Across the country, couples will be allowed to have a second child if one of the parents is an only child. The Office of International Affairs reached out to Karen Eggleston, director of the Asia Health Policy Program and Scott Rozelle, co-director of Rural Education Agriculture Program (REAP) for their views on this new policy and what it means for China.


Q. The impetus for easing the one-child policy is to partially stimulate the slowdown of economic growth.  Do you see this as an effective strategy?

SR: Even if China's fertility rates changed over night, China is destined to be one of the fastest aging societies that there has ever been. Faster than what happened in Japan in the 1980s and 1990s. Aging in Japan is in no small part responsible for the near zero growth that Japan has experienced over the past 20 years because aging undermines savings, investments, and growth, and distorts incentives to invest in education and nutrition for the young. If China follows a similar path, by the 2030s it may not expect very high growth rates if any at all--in part, due to aging. The policy change does nothing to offset this problem.


KE: The slow-down of China’s economic growth rate is related to a long list of determinants, including reaching middle-income status and the need to innovate rather than imitate for further improvements in multi-factor productivity. Demography is only one, and probably not the most salient, factor. In the medium term, the policy easing is likely to raise the total dependency ratio – elderly and children compared to the working age population – with a long-term effect on population age structure a decade or more in the future.

Q. Now that many parents in China have a choice to have another child, can we assume that fertility rates will increase?

KE: Predicting how much fertility will likely respond to this policy easing is notoriously difficult -- and Chinese cities that never had the one child policy like Hong Kong have well below replacement fertility.


SR: It is likely that there will be little change in fertility due to this policy. There has long been a policy that when both individuals in a marriage are single children, they can have two babies. Few take advantage of this policy. It would seem that two only children would be more likely than couples where there was one only child (and one non-only child) to opt to have more babies. Families today only want to have one -- with the high cost of rearing a child, the high opportunity cost of children, etc. There are no restrictions in the surrounding nations/regions for have two or more children (e.g., Japan, South Korea, Taiwan). Fertility rates in these countries are very low.


Q. Will this policy correct the current gender imbalance?

KE: There is some hope that this easing will help to ameliorate the significant demographic challenge for China: the large imbalance of boys compared to girls, and the looming threat of millions of "forced bachelors," for whom it may already be too late (short of importing brides from abroad). Even if the policy easing leads to a return of the sex ratio at birth to near-normal levels, the existing imbalance on the adolescent and young adult population will create challenges for many years to come.

SR: There will be 80 million more adult men than women in China in 2030. The world has never experienced such massive men-to-women imbalances. What will these 80 million men do if they are poor, undereducated, not married, with no family? Hardly any of the potential outcomes are nice to think about. This policy change does nothing to offset this problem.


Q. What are your views as to how this will affect the healthcare system?

KE: China's health care system will have to continue to re-orient from care of acute conditions and infectious disease control to a broader mandate that includes quality, convenient, and affordable management of chronic diseases, alongside renewed efforts to improve maternal and child health. This is especially important in remote rural areas where, perhaps ironically, the policy may have little impact because many rural couples already were allowed two children, especially if the first was a girl.


Q: Any final thoughts?

KE:  Demographers inside and outside China have long urged the government to consider relaxing the "one-child" policy, given the economic and social strains likely to ensue from China's rapidly aging population. Once this new policy is fully implemented, millions of parents who themselves never had a brother or sister will have the opportunity for their children to grow up with siblings. This is a crucial arena of choice restored to the Chinese, and will eventually make it easier for current generations to fulfill their obligations and desires for filial piety to China's burgeoning number of elderly. The effects on the population age and gender structure will not be felt for a long time to come. In the meantime many pressing issues of health, education, and investment in China’s future leadership generation need to be addressed.


SR: If the One Child Policy had been discontinued 20 years ago and had been directed at rural families as well as urban, China's demography would not have been so skewed. But, demography is destiny. The parameters for the population in China in 2030 are set. Little can be done. Hence, for these reasons I believe the new policy changes will have no short-term consequences and little long-term effects either.