Fertility rate, fertility policy, and climate policy: A case study in China

Abstract

Although population growth plays a vital role in driving anthropogenic climate change, fertility impact on achieving mitigation target is usually overlooked in literature. This paper attempts to narrow the research gap by employing a Computable General Equilibrium (CGE) model to analyze the interrelations among fertility rate, fertility policy, and climate policy in China. The model results show that fertility rate negatively correlates with GDP and emissions because higher fertility induces more labor for childcare and thus crowds out labor for work. The three-child policy raises fertility intention; it does not unidirectionally influence the effects of the emission trading scheme (ETS) on employment and GDP, but it increases ETS emission abatement. Technological progress increases GDP and decreases emissions; the three-child policy strengthens technological impact on GDP but weakens technological impact on emissions. Hence, technological progress benefits emission mitigation; the three-child policy enhances economic benefits but impairs emission abatement of technological progress.