Demographics Threaten Asian Economies – 12/06/15

Demographic trends – long-term changes in the makeup of a population – drive or are driven by major turning points in human history. Improvements of technology lead to booms in population size, lower maternal mortality rates, and mass migrations. In the 21st century, the trends differ significantly from those of the past. Developed countries in Asia and Europe face especially troubling demographics trends such as graying populations, something that weighs down economies where fewer workers must provide for increasing numbers of elderly non-workers, and disproportionately high male-to-female birthrates in China and India, artifacts of cultural practices encouraging the birth of boys and the selective abortion and abandonment of girls, leaving the countries with skewed sex ratios and significantly weakened growth prospects.

In recent years, Japan has faced significant issues related to the aging of its populace as roughly 25% are 65 or older, a proportion likely to increase given low fertility rates and high life expectancy. A lack of young workers combined with a reluctance to expand immigration programs has encouraged the development of automation techniques and ways to utilize the elderly who still wish to participate in the labor force but leaves Japanese companies short-staffed. Low expectations for long-term growth have also scared off much needed capital investments. Though Japanese policies and technical innovations will  help to cushion the impact of an increasing number of dependents per worker, this greying trend is the new normal for developed countries. The aging of Japan represents a dilemma that many of the most populous and developed countries will face within a few decades.

China and India may face their own demographics crunches brought on by a lack of women. In China, a combination of One Child policy, Confucius traditions  encouraging a strong bias towards male heirs, and increasing urbanization has left the country with a dangerously skewed sex ratio, following years of anti-female birth practices, and a population with little incentive to the additional girls needed to sustain the society. Though the government scaled back its restrictions on the number of children each family could have, a slowing economy has discouraged families already having fewer children due to less need for large families in the urban area where an educated few tend to be more successful. India faces similar issues due to a patriarchal society and dowry system which have made having a female baby a social and financial liability.

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