The Shift in Population Aging and the Onset of High Savings in China
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Xinhui Liu, Chuo Zhang
This paper examines the impact of aging on savings from two perspectives, namely life expectancy as well as dependency ratio, based on life cycle theory, using panel data for 28 Chinese provinces from 1989-2015 as a sample. 2SLS regressions conclude that rising life expectancy and rising per capita income promote higher savings rates. Thus, there is an evolutionary intrinsic correlation between China's demographic dividend and high saving, and the high saving in China is partly explained by the saving effect of the Chinese demographic dividend.
Demographic structure; Dependency ratio; Life expectancy; Savings rate