A demography opportunity set that brings prosperity

The total fertility rate in China has fallen to 1.1 in 2021, which is not only below the replacement level, but also below that of the high-income group. This paper analyzes the characteristics of China in perspective from the demography opportunity set that originated in Sun and Wei (2022). Using genetic algorithms to estimate the parameters and comparing them to those of the high-income group, we found that Chinese characteristics are primarily reflected in higher education cost and lower parenting stress. By combining characteristics of China and the high-income group, we propose a demography opportunity set that allows for higher total fertility rate and expected years of schooling at the expense of a reasonable loss of parental time share. To achieve this demographic prosperity, China should lower the education cost, and the high-income group should lower parenting stress.