How to Adjust the Family Planning Policy in China?

Abstract

Recent years have witnessed a sharp drop in China’s demographic dividends; therefore, some reform measures have been adopted with regard to China’s family planning policy to optimize the population structure and to maintain demographic dividends. However, our simulation results reveal that the new two-child family planning policy cannot effectively manage the ageing population and that China’s family planning policies require further adjustment. Based on a combination of simulation results and formula derivation, the new two-child family planning policy will deteriorate the demographic dividends before 2050. With the aim of stabilizing the demographic dividends in an ideal range, this section builds a non-linear integer programming model to propose an appropriate reform path for China’s family planning policy. Then, this section simulates and compares the demographic developments under the proposed reform path with those under three possible family planning policies, i.e., the one-child policy, the two-child policy, and cancellation of family planning policy, verifying that the proposed reforming path obtains better performance stabilizing the demographic dividends than these three family planning policies. Finally, a sensitivity analysis of the upper bound of the research interval is conducted to evaluate the effect of the upper bound on the proposed reform path. Based on these results, this section suggests that China should continue to implement its current strict family planning policy until 2032, gradually begin to relax it, especially from 2036 to 2041, and completely cancel its family planning policy after 2065.