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Prof. Huang Wei: Bring Childbearing Costs Down

Jan 04-2024   



A major reason for China’s low fertility rate has been the high costs related to childbearing and rearing, said Prof. Huang Wei in one of the events of Langrun Policy Talk. He shared his research on the various direct and indirect costs and made recommendations to bring them down.

 

What is termed ‘reproductive penalty’ in economics literature, according to Prof. Huang, refers to the opportunity costs of women, and in some cases also men, to have babies and bring them up. That involves sacrificing their career and free time. As of the direct costs, Prof. Huang enumerated three major categories of expenses: those for taking care of mothers and their newly born babies, those for education, and those for moving into a bigger apartment. Some parents go so far as purchasing apartments for their children.

 

Adopting the dynamic analytical method developed by Prof. Henrik Kleven of Princeton University, Prof. Huang found that female labor force supply dropped by nearly 30% in their childbearing year, before picking up gradually in the ensuing years and hitting a peak eight years later, when their children attend school. In contrast, male labor force supply rose right after their childbearing years, perhaps indicating their increased efforts to support the family, said Prof. Huang.

 

By plotting the childbearing costs and changes in birth rates of various regions in China, Prof. Huang demonstrated that from 2000 to 2015, the faster the jump was in childbearing costs, the bigger the drop was in fertility rate. A caveat was that it only represented a simplistic relativity analysis and the patterns didn’t amount to causal relationships.

 

Salary-wise, male workers were able to maintain incomes at pre-childbearing level, while females saw a shrinking salary that persisted years after childbearing; in fact, female salaries couldn’t return to pre-childbearing levels. Having a child also led to a decrease in household savings largely due to higher spendings and lower incomes, said Prof. Huang, adding that the costs also testified to the profound love of parents towards their children.

 

To reduce such costs and encourage childbearing, Prof. Huang believed that the joint efforts of the government, companies, and society are needed. Firms should be willing to recruit female employees and shouldn’t discriminate against them due to their childbearing decisions, maternity leaves, and efforts to raise children. The government should adopt policies and institutions that create an equal job environment for women and reduce their opportunity costs.

 

Prof. Huang Wei: Bring Childbearing Costs Down

Jan 04-2024   



A major reason for China’s low fertility rate has been the high costs related to childbearing and rearing, said Prof. Huang Wei in one of the events of Langrun Policy Talk. He shared his research on the various direct and indirect costs and made recommendations to bring them down.

 

What is termed ‘reproductive penalty’ in economics literature, according to Prof. Huang, refers to the opportunity costs of women, and in some cases also men, to have babies and bring them up. That involves sacrificing their career and free time. As of the direct costs, Prof. Huang enumerated three major categories of expenses: those for taking care of mothers and their newly born babies, those for education, and those for moving into a bigger apartment. Some parents go so far as purchasing apartments for their children.

 

Adopting the dynamic analytical method developed by Prof. Henrik Kleven of Princeton University, Prof. Huang found that female labor force supply dropped by nearly 30% in their childbearing year, before picking up gradually in the ensuing years and hitting a peak eight years later, when their children attend school. In contrast, male labor force supply rose right after their childbearing years, perhaps indicating their increased efforts to support the family, said Prof. Huang.

 

By plotting the childbearing costs and changes in birth rates of various regions in China, Prof. Huang demonstrated that from 2000 to 2015, the faster the jump was in childbearing costs, the bigger the drop was in fertility rate. A caveat was that it only represented a simplistic relativity analysis and the patterns didn’t amount to causal relationships.

 

Salary-wise, male workers were able to maintain incomes at pre-childbearing level, while females saw a shrinking salary that persisted years after childbearing; in fact, female salaries couldn’t return to pre-childbearing levels. Having a child also led to a decrease in household savings largely due to higher spendings and lower incomes, said Prof. Huang, adding that the costs also testified to the profound love of parents towards their children.

 

To reduce such costs and encourage childbearing, Prof. Huang believed that the joint efforts of the government, companies, and society are needed. Firms should be willing to recruit female employees and shouldn’t discriminate against them due to their childbearing decisions, maternity leaves, and efforts to raise children. The government should adopt policies and institutions that create an equal job environment for women and reduce their opportunity costs.