Age structure and economic growth: The quantification of China’s demographic dividends

This paper studies how much the age structure dynamics contributed to China's economic growth between 1991 and 2019. We first propose a theoretical model to describe the impacts of age structure transitions on household consumption, savings, and economic growth. Then, we use China's country-level data between 1991 and 2019 to measure the economic growth rate driven by demographic dividends. Empirical results indicate that before the year 2011, age structure transitions in China led to the increase in both labour supply and the household savings rate, and positively contributed to the country's economic growth in most of the years starting from 1991. In specific, the average annual contribution rate was around 0.25%, with the highest rate being 1.25% in the year 2000. However, the demographic dividends vanished in 2012, since when the country has entered the period of demographic debt.