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As the population ages, will older people be able to retire? In that case their productivity transforms to a negative, needing to be supported by the remaining

As the population ages, will older people be able to retire? In that case their productivity transforms to a negative, needing to be supported by the remaining workers.

adventured 5y ago
China's output per capita is so mediocre (~$12k GDP per capita) there is a lot of room to outrun the worker contraction and retirement context. Although I'm skeptical their increasingly rigid economy, courtesy of Xi transporting them back in time to a worse system of stricter command & control (vs a more liberalized approach), will be capable of it. Their productivity doesn't transform into a negative. To deal with more aged persons, they need to bolster output and taxation on that output, such that society builds a social safety net for the retired. China has room for increased taxation on various aspects of wealth and income in their nation (their wealth has ballooned massively in the last 10-20 years obviously), along with higher personal income tax rates in general. Increasing productivity and automation frees labor to be devoted to other things that society needs. For example their farming system is very ineffecient, they have far too many people working in farming producing far too little (compare it to the US, South Korea or Japan). If you bring that up to where it should be, some of that labor becomes available to take care of the elderly, paid for via taxes. Now apply that to everything else in China that still needs modernized, made more efficient, automated.
- hackerfromthefu 5y ago
  This very much depends on the ratio of retirees to workers. Also automation may not play out so well for Chinese production, as it's more sensible for other nations to bring automated manufacturing onshore for a combination of reasons including reduced transport, supply chain certainty, stabler internal economics. Onshoring automated manufacturing could still use a significant amount of international remote labour, but the hosting country would capture more of the taxation from the manufacturing, which you mention as going to pay for the Chinese retirees.

As the population ages, will older people be able to retire? In that case their productivity transforms to a negative, needing to be supported by the remaining workers.

adventured 5y ago

China's output per capita is so mediocre (~$12k GDP per capita) there is a lot of room to outrun the worker contraction and retirement context. Although I'm skeptical their increasingly rigid economy, courtesy of Xi transporting them back in time to a worse system of stricter command & control (vs a more liberalized approach), will be capable of it. Their productivity doesn't transform into a negative. To deal with more aged persons, they need to bolster output and taxation on that output, such that society builds a social safety net for the retired. China has room for increased taxation on various aspects of wealth and income in their nation (their wealth has ballooned massively in the last 10-20 years obviously), along with higher personal income tax rates in general. Increasing productivity and automation frees labor to be devoted to other things that society needs. For example their farming system is very ineffecient, they have far too many people working in farming producing far too little (compare it to the US, South Korea or Japan). If you bring that up to where it should be, some of that labor becomes available to take care of the elderly, paid for via taxes. Now apply that to everything else in China that still needs modernized, made more efficient, automated.

hackerfromthefu 5y ago
This very much depends on the ratio of retirees to workers. Also automation may not play out so well for Chinese production, as it's more sensible for other nations to bring automated manufacturing onshore for a combination of reasons including reduced transport, supply chain certainty, stabler internal economics. Onshoring automated manufacturing could still use a significant amount of international remote labour, but the hosting country would capture more of the taxation from the manufacturing, which you mention as going to pay for the Chinese retirees.