The Past, Present and Future of Demographics in China & India

Updated: May 28

Because Google Adsense deemed this website to have too little content for ads, I'll be posting my top 25 undergraduate papers. This paper was a one of a batch of small papers about data analysis of China & India. It prepared me very well for a career in data journalism. Thank you professor Cyrus.

Dalhousie University

ECON 2213

September 19th, 2018

Demographic shifts have occurred everywhere throughout history. The World Bank database shows these demographic trends of China and India reasonably well. Providing clear numbers for what stage of the traditional demographic shift they are in and how the shift is affected by GDP per capita. There have also been past projections that we can potentially validate with this data.

To begin with, demographic history for both countries are similar. For China, the ages 0-14 demographic peaks in the early 70s and has been on a steady decline since. That is why the 65 and older demographic has been increasing, leading to the working age to peak in 2010. For India, the ages 0-14 demographic peaks in 1966. However, the 65 and older demographic, while it has grown steadily, it has grown slower compared to China. That has caused the working age demographic to increase, but it hasn’t begun decreasing yet. The 0-14 demographic peaked for both decades ago because China hit its peak birth rate in 1963 with 43 per 1,000 people. And for India, it was in 1960 with 42 per 1,000 people.(1)

Now it’s not hard to envision that GDP per capita plays a role here given the correlations between it and the birth rates. The birth rate has a significant negative correlation with GDP per capita in not only China & India but western nations such as Canada as well (-0.91 for Canada, -0.66 for China and -0.92 for India). Since the declining birth rate is connected to a higher working age to non-working age ratio, it shouldn’t be surprising that ratio has a significant positive correlation with GDP per capita in those three countries as well (0.85 in Canada, 0.86 in China and 0.98 in India).(2)

To compare with a previous paper, Bloom and Williamson suggested in their article “Demographic Transitions and Economic Miracles in Emerging Asia” that as birth rates decline, the working age to non-working age ratio will rise, then begin to fall again.(3) This data matches their hypothesis. China has already reached its peak regarding the working age to non-working age ratio in 2010 with a ratio of 2.809. In the most recent years, it has started its decline. As for India, their ratio is still growing, so they haven’t reached their peak yet. The most recent data point is 2017 with a ratio of 1.96.(4)

In conclusion, the birth rate for China and India peaked in the 60s. That caused an increase in the working-age population throughout the years. The working age for China peaked in 2010 as its population is getting older and older. For India, it appears their working-age population is still growing and has yet to peak, but the trend is about the same as both countries are continuing to age. Declining birth rates are the cause of this demographic shift, and birth rates have a significant negative correlation with GDP per capita in not only China and India but Canada as well. This data agrees with the conclusion of Bloom and Williamson that the working age to non-working age ratio will increase then decrease again after birth rates decline.

Appendix 1: Data (first and last years shown)

1 - See Appendix 1

2 - See Appendix 1

3 - Bloom, David, and Jeffrey Williamson. "Demographic Transitions and Economic Miracles in Emerging Asia." Page 2. 1998. Accessed September 27, 2018. doi:10.3386/w6268.

4 - See Appendix 1