Demographic age structure and economic development: Evidence from Chinese provinces

Zhang, Haifeng, Zhang, Hongliang, and Zhang, Junsen—Demographic age structure and economic development: Evidence from Chinese provinces In this paper, we examine the economic implications of demographic age structure in the context of regional development in China. We extend the development accounting framework by incorporating age structure and apply it to a panel data set of 28 Chinese provinces. We find that changes in age structure, as reflected by shifts in both the size and internal demographic composition of the working-age population, are significantly correlated with provincial economic growth rates. During our study period 1990–2005, the evolution of age structure accounts for nearly one-fifth of the growth in GDP per capita, of which more than half is attributable to shifts in the internal demographic composition of the working-age population. Differences in age structure across provinces also explain more than one-eighth of the persistent inter-provincial income inequality. Journal of Comparative Economics 43 (1) (2015) 170–185. Center for Labor Economics and Public Policy and School of Public Affairs, Zhejiang University, China; Department of Economics, The Chinese University of Hong Kong, Hong Kong. 2014 Association for Comparative Economic Studies. Published by Elsevier Inc. All rights reserved.