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AN ANALYSIS ON THE IMPACT OF THE POPULATION CONTROL
ON CHINESE ECONOMIC DEVELOPMENT
Liu Jiaoliang, Yin Liuying, Liu Yongkang
System Dymamics Group
The Management School
Shanghai Jiao Tomg University
ABSTRAUT
Chima has the greatest population in the world.The impact of the population
on Chinese economic developmemt is great, Based on Chimese National Ecomo-
mic Model NATN3, the relationship between the population control policy in
Chima amd Chimese economic development are obtaimed by simulation of the
policy amalysis.
I. A BRIEF INTRODUCTION 10 CHINESE NATIONAL ECONOMIC MODEL NATN3
It is well known that, Chinese strategic target for economic development is
to quadruple the annual gross value of industry and agriculture output of
1980 and achieve a fairly well off life for Chinese people by the year 2000.
So taba ye in the year 2000" is avery meamingful study (Wamg Weiqum & Li Bei-
qi 1984).
For the reasons stated above, a study group is set up in the Management
School of Shanghai Jiao Tong University to develop Chimese National Economic
Models and to conduct studies on the future of China. After its set up in
the begimning of 1984, the group has developed Chimese National Economic
Models NATN, NATN1, NATN2, NATN3.
The practice in tne past one year has given the group a deep feeling that,
in the light of the specific conditions in China,system dynamics techniques
are pretty applicable to develop Chimese National Economic Models.
By 1979, Chinese economy is a planned economy which was almost exclusively
controlled by the state. The governmemt policies gave a decisive effect on
the economic development. This is a good explanation for the fluctuations
of Chinese economy in the first thirty and few years after the foundation
of. the People’s Republic of Uhina. The situations are easy to be expreesed
by policy variables in system dynamics model.
Now, Chinese government is making a series of decisioms to reform the eco-
nomic structure, such as
(1) Imvigoratimg the domestic ecenomy;
(2) Opening to the outside worlds
(3) Accelerating the restructure of national economy.
All these will lead to tremendous changes in people's socia-economic life,
These situations are more conveniently reflected by system dynamics model.
Chinese National Economic Models are developed under the very background
stated above. Im the model NATN3 include such eleven sectors as the popu-
lation,the public finance, the agriculture,the light industry,the heavy
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industry, the commerce,the communications and transportation,the construc—
tion industry, the energy resource, science and technology and educution,
and the environment protection. The model hs 663 equations, among which
there are 33 Levels and 65 Retes. The model has showm its logical ration-
ality in the identification, estimation, and validation. Its structure
tallies with the actual situation in China.
II. AN ANALYSIS ON THE IMPACT Or rH POPULATION
ON CHINES# &CONOMIC DEVELOPMENT
China has the greatest population in the world. Especially, after the foun-
dation of the PRu, the well-beimg of the people has been betterimg and the
average life expectancy of the people has been increasing greatly. On the
other hand, in the first dozens of years after the foundation of the PRC,
the population control had not been conducted effectively, und the popula-
tion had been growing rapidly. rhe overrapid populatiom growth would un-
doubtedly impair Chimese economic development and would slow down improv—
ing the life standard of the people. At last the people has understood
that the population has to be controlled. Amd the government has resolu-
tely taken a variety or measures to control the population growth. Speci-
ally in the last few years the measures have effectively controlled the
population growth.
Simce the foundation of the PRC, census has beem conducted twice(first in
1964, secomi in 1982), The census in 1982 showed that there is a popula-
tion of 1,031,882,511(with a population of 1,008,175,288 whem Taiwan being
not counted). It had growed 45,1% in the 18 years since 1964. The average
growth rate is 2.1% per year. Attemtion should be paid to the fact that,
in the first 9 years the average growth rate is 2.68%, in the second 9
years is 1.51% Im comtrast, during the 18 years since 1964, the gross
output value of industry and agriculture in China growed 9.3% per year
averagely, natiomal income growed 7.4% per year. Since China has a big
population base, and her economic basis is still weak, and the producti-
vity is not high, a study on the relationship between the population and
the economy is of great importance for the realization of the strategy
for economic development and for increasimg the national income per
capita.
The population and the economy are closely interrelated amd interdependent.
The development of the economy will improve the conditions of production
and life, and will quicken the population growth. The population growth
will in turn influence the economic development. First the part of right
age in the population can provide labours for the agriculture,the indus-
try,the commerce,and so on. This is the aspect that the populetion puts
an active effect on the economic development. Next,considering the fund,
people need food, clothes, houses, education, recreational activities,and
other consumption to live. Too large a population would increase the mon-
productive expenditure, and would decrease the economic growth rate. Es-
pecially,it would slow down the growth of the national income per capita
and would impair the improvement of the people's life standard. In addi-
tion,too large a population would impair the youngsters' education and
training. It would be detrimental to enhancing the population quality.
These are the negative consequences causing by too large a population.
According to the actual situation in China,the labour resource which is
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indispensidle for the economic development is more than sufficient,and in
the next dozens of years the labour resource won't be lacking yet. There-
fore, the active effect of the population growth on the economic develop-
ment has lost its significance. Besides,in order to realize the strategic
target set for the end of 20th century,China is in urgent need of bringing
up a variety of specialists in social science,in economics,in management,
in natural science and technolegy,amd needs skilled workers of better edu-
cation in her all trades and professions,so as to ameliorate today's inef-
ficiency in some sectors. For this reason,the government of the PRC not
only advocates family planning,but also encourages healthy birth and better
educating youngsters,so as to enhance the quality of the new generations.
III. THE SIMULATION RESULTS ON MODEL NaIN3
The relationship between the population and the economy as mentioned above
might well be exposed in MODEL NATN3. The causaltackfeeding sketch of the
population submodel of the model is shown in Fig.1. It could be made out
from the figure that,according the actual situatuon in China,the popula-
tion is divided .into two parts:the rural population and the urban popu-
lation. The birth rate is related with the number of women in birth age,
and could be controlled by the population-control policy and the alleca—
tion of funds for family planning. The death rate is reflected bythe aver-
age life expectacy. The higher the life expectancy is,the lower the death
rate and the faster the population growth. The factors which influence in
the life expectancy might be
(1) the total quantity of the foodstuff provided by the agriculture
(per capita);
(2) the investment in medical and health,in the public welfare and in
the like (per capita);
(3) the investment in the culture recreation and alhletic accommoda-
tion (per capita);
(4) the extent of the emvironment pollution;
(5) the total housing area in urbam provided by the construction in-
dustry (per capita).
The influence of the economic development on the population has been shown
in Fig.1. The influence of the population on the economy could be shown in
the light of the effect of the population submodel's output~--such as the
educated rural population,the productive rural population, the educated ur-
ban population,the productive urban population--on the other submodels. In
addition,the consumption,the allocation of the funds, the enhancing of the
educational level,and the influence of the scientific and technological de-
velopment on the pro-duction, could all embody the influence of the popula-
tion on the economy.
In this model,thepopulation control policies are expressed by a kind of
TABLE function supported by DYNAMO, a natural idea is that,the larger the
population is,the higher the urgentness of the population control,and the
fewer births must be obliged for each woman during her birth age. There-
fore,in this TABLE function the population growth rate serves as the inde—
pendent variable,and the average number of births for each woman during her
birth age,under the control of the policies,is the dependent variable.
In order to analyze the relationship between the population control poli-
LABOUn FORCE EDUCATED Forvianion
LABOUR 20RCE EDUCATED POPULATION
zi ar pit ora TM URBAN k jo BY ee
\ i
\ ]
\ / .
\ , \ }
\ / HAUSTEG ane.
MiGuriod ~~~ popurarion PSR CAP
w TT.
a RURAL i Heed
‘NOMBERS OF Ke Can RATE (+) Ne
NUMBZHS OF WOMEN
IN THIR BIRTH AGB IN DEIR C ‘AGE DEATH RATE
LIFE EXPECTANCY :
GS LIFE BXPRCTANCY
URGENTNBSS OF BRASH Aas URGENTNESS OF ee RATE h
POPULATION CONTROL POPULATION CONTROL J \
POPULATION FUND YOR , POPULATION FUND FOR i
‘cONTROL POLICY rd PLANTING &
&
I
CONTROL POLICY PAMILY PLANNING
MEDICLITE SXTENT OP THE
ae Wepstvre POLLUTION MEDICINE POODSTUF TH
WELFARE (PER CAPITA) BRALTH BXTBUT OF
(pen CAPiTA) WELPARB (PBR GAPTTA) ~ POLLUTION
(PER CAPITA)
CULTURE RECREATION
&
ATHLETIC ACCURNODATTON CORITHE MECRNSTION
@
. ATHLETIC ACCOMODATION
¥+1 TIE CAUSAL BACKFBEDING SKHTCH OF THE POPULATION SuEMODsi.
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cies umd the economy,five schemes for the population control are worked out,
The population, the national income, the income per capita,and the gross
output value of the industry and agriculture are obtained by simulation of
the policy analysis,all presented in ab.1.
fab.1 The Results of Simulation on MODEL NATN3
SOCIAL-ECONOMIC INDez
POPULATION CONTRL POLICY IN YA 2000
gross
eotud national output
average number of births for national income value
each woman during her birth age popu income per of
lation f 5
capita indus.
& agr.
SCHEME
No.1 3.0 2.5 2.0 2.0 2.0 2.0 1357.4 14839.9 1093.2 35042
No.2 3.0 2.5 2.0 2.0 1.5 1.5 1328.3 14825.8 1116.2 35615
No.3 3.0 2.5 2.0 1.5 1.5 1.5 1299.6 14755.7 1135.4 35483
No.4 3.0 2.5 2.0 Lb 1.4 1.3 1295.8 14843.3 1145.5 35648
No.5 2,0 1.8 1.5 1.0 1,0 1.0 1248.3 14847.5 1189.4 35656
Given the population growth te: Social-Economic Imdex in 1980;
-.006 0,006 0.000 0.012 0.018 0.024 987.0 3600.0 364.7 8520
The analysis gives the following results:
(1) each ot the above population control policies might vell reach Chinese
A economic target,that is,to quadruple the gross value of the industry
and agriculture output of 1980 by the year 2000;
(2) the current years are in the peak congested with women in their birth
age. Therefore,the policy which advocates each married couple having
only one child in their lives is rational. And when the peak declines,
the population control could be relaxed somewhat;
(3) with the implimentation of the population control policy,the proportion
of the aged in the population will grow every year,the very percentage
will almost double by year 2000, taking that of 1980 as the base. How~
ever,the labour resource would not be lacking yet.
REFERENCES
Forrester,Jay W. Primciples of Systems, Cambridge,Mass.:Wright Allen Press,
1968.
Meadows,D.H.,et al. The Limits to Growth, New York:Universe Books,1972.
Meadows,D.L.,et al. Dynamics of Growth in a finite World, Wright-Allen
Press,Inc, 1974.
Wang Weiqun and Li Beigqi, Systematic Study on "China in the year 2000",
System Engineering Theory amd Practice, No.2,1984.(in Chinese)
