Due to the Chinese culture of inter-generational supporting, the public worries that the incoming scheme of delayed retirement may lower the fertility rate and therefore the two-child policy cannot play well. In order to provide full evidence of how delayed retirement affects family fertility, this study systematically examines the effect of delayed retirement on family fertility from the perspectives of theoretical and empirical analyses. By introducing the variable of time allocation for the elderly, we extend the overlapping-generation model in which delayed retirement and retired senior employment are both considered to be endogenous based on the framework of general equilibrium. This model shows that delayed retirement can improve the conditions of family supporting for the elderly and raise the level of birth while retired senior employment has an adverse effect on family supporting and fertility. The impact mechanism is that economic output promoted by delayed retirement will increase the financial resources for child support, which finally contributes to encouraging family fertility. Considering the government has not implemented the new policy of delayed retirement nationwide, we use the data from OECD countries to analyze the association between delayed retirement and fertility. No evidence shows that the delaying of average age retirement is negatively associated with the fertility rate. On the contrary, delayed retirement has a significant effect in boosting family fertility. In short, from the theoretical analysis and international experience, postponing retirement at least will not have a negative impact on fertility. One possible impact pathway is that the increase of output and social resources, resulting from the labor supply of delayed retirement, may play an important role in improving the economic conditions of child support and thus motivating family fertility. Because of the lack of relevant accompanying policies to support family fertility in China, it is no wonder that many people are concerned about the adverse effect of delayed retirement on fertility. Our study suggests that, to ensure the increase of economic output from delayed retirement can be effectively distributed into fertility support, several policies such as child care subsidies and community children’s nursing services are needed to be established before the implementation of delayed retirement.
Will Delayed Retirement Occupy Family Fertility?
Journal of Finance and Economics Vol. 44, Issue 10, pp. 53 - 66 (2018) DOI:10.16538/j.cnki.jfe.2018.10.004
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Cite this article
Yang Hualei, Shen Zheng, Hu Haoyu. Will Delayed Retirement Occupy Family Fertility?[J]. Journal of Finance and Economics, 2018, 44(10): 53-66.
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