I would just say: The demographic dividend is an elegant theory, but culture is the ultimate economic fundamental *** Allowing people to have more children will help address a shortage of working-age people only after 20 years or so, once those children have grown up, said Mr. Sheets, a former senior international economist at the Federal Reserve. Until then, the additional children arent working—and need to be cared for. This means fiscal costs [especially schools] and lays claim to hours that their parents may have otherwise spent working in their jobs. the relaxation of the one-child policy exacerbates Chinas loss of its so-called demographic dividend, the economic gains it was able to make because of its advantageous demographics from 1985 to 2015, when the workforce grew and the number of dependents also fell. The one-child policy, while widely criticized as cruel and inhumane, deepened the demographic dividend by limiting births further, demographers say. While demographics presented China with an opportunity, it doesnt explain the countrys remarkable rise from poverty, economists say. The rise in labor supply gave China an opportunity to grow, which it took advantage of by opening its economy to the outside world and focusing on manufacturing, exports and infrastructure. Those industries sucked up millions of unskilled workers who migrated from Chinas rural areas. Many other countries, especially in Latin America, didnt take advantage of similar demographic opportunities over the past two decades, when birthrates there also fell and the working age population increased, said Nicholas Eberstadt, a demographer at the American Enterprise Institute, a Washington think tank.The demographic dividend is an elegant theory, but unless institutions and economic reforms are in place to translate the potential into wealth, the dividend wont be realized, he said. Currently, Indias five-year plan, covering 2012-2017, hopes to capitalize on its still-rising working population. Chinas demographic dividend would start tapering off by 2015, but India would continue to enjoy it till 2040, says the plan. But Carl Dahlman, a development expert at the Organization for Economic Cooperation and Development, says that India hasnt prepared the way to take advantage of the helpful demographics because much of its workforce is unskilled and ill-educated and the country hasnt tried to remake itself into a manufacturing and export hub, like China did. India has a tremendous opportunity, he said. But they dont have labor skills or infrastructure to take advantage of that opportunity. (By BOB DAVIS) ***
Posted on: Thu, 21 Nov 2013 22:36:13 +0000
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