¹Han Qing, ²Ren Jingyi, ³Doris Padmini Selvaratnam

^1,2,3Bangi, Selanhor UKM

DOI : https://doi.org/10.47191/ijsshr/v7-i06-29

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ABSTRACT

This study examines the influence of demographic ageing on savings patterns in China. China is facing significant economic issues due to its ageing population, as indicated by the research. These challenges are mostly caused by the rising old age dependency ratio and longer life expectancy. The study utilizes data from the period of 2010 to 2020 and applies the Vector Autoregressive (VAR) model to uncover the intricate relationship between ageing and savings. Findings indicate that populati on aging initially suppresses household savings rat es but may stimulate them in the medium term due to anticipatory saving behavior. At the social level, the growing number of elderly individuals places a greater strain on the economy, yet the possibility of longer life spans may encourage people to save more. The research offers vital information for policymakers seeking to tackle the economic consequences of a growing elderly population by strategic interventions like legislation that encourage delayed reti rement, enhanced social security systems, and o ngoing technology innovation.

KEYWORDS:

Population aging, Savings behavior, Old age dependency ratio, Life expectancy, Vector Autoregressive model, Economic policy

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Volume 07 Issue 06 June 2024