How ageing affects manufacturing transformation: empirical evidence from China

ABSTRACT

This article explores the impact of population ageing on China’s manufacturing transformation, and considers the mediating role of government fiscal burden. The development of China’s manufacturing industry has long relied on low-cost labour, and ageing challenges this model. The results show that population ageing promotes manufacturing transformation. Through the mediation effect analysis, we find that ageing will reduce government tax revenue, thereby hindering the manufacturing transformation. However, increased healthcare spending due to ageing has a positive effect on the manufacturing transformation. Our research provides useful insights for the government to adjust fiscal revenue and expenditure.

KEYWORDS:

• Ageing
• manufacturing transformation
• mediation analysis
• the financial burden

JEL CLASSIFICATION:

• C33
• J14
• O14

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This research was supported by the National Social Science Foundation of China(17BRK001).