The Demographic Dividend or the Education Dividend? Evidence from China’s Economic Growth

Abstract

Developing countries face a significant challenge in sustaining their demographic dividend. However, there are few existing studies that approach this issue from a macroeconomic perspective or through empirical research. This paper aims to systematically analyze the impact of the demographic dividend and education dividend on economic growth. By utilizing China’s empirical evidence and employing the System GMM method, we explore how to improve both dividends. Our main findings can be summarized into three aspects. First, the demographic dividend does not depend on population size alone but also on the size of the labor force. Second, education can improve the demographic dividend and thereby prove the existence of an education dividend. Finally, the effects of the demographic and education dividends vary across regions and stages of development within developing countries. This research enriches the existing literature on education and population age in developing countries.