Population Aging and the Demand for Private Health Insurance in China

Abstract

Abstract This study examines the potential impact of aging on the demand for private health insurance (PHI) in China. Using the provincial data for 2000–2018, we find that a 1-percent increase in each proportion of the elderly population and old-age dependency ratio increases the PHI demand by 4.8 and 5.2%, respectively. A one-percent increase in the child dependency ratio decreases the PHI demand by 1.5%. We employ an instrumental variable approach; the findings support that the proportion of the elderly individuals in the total population, old-age dependency ratio, child dependency ratio, and urban green area significantly affect the PHI demand. The rolling estimate indicates that aging has a significant positive effect on the PHI demand over a rolling window of a fixed sample size. Additionally, by controlling for province and year fixed effects, we find that aging is positively associated with the PHI demand in China.