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Chapter 3: Problem 13

From 1979 to 2015 , China had a policy that allowed couples to have only one child. (Since 2016 , couples have been allowed to have two children.) The one- child policy caused a change in the demographics of China. Between 1980 and 2015 , the share of the population aged 14 and under decreased from 36 percent to 17 percent. And, as parents attempted to ensure that the lone child was a son, the number of male children relative to female children increased. Choose three goods and explain how the demand for them has been affected by China's one-child policy. Sources: World Bank, World Development Indicators, April 2016; and "China New 'Two Child' Policy Increases Births by 7.9 Percent, Government Says," cbsnews.com, January 23, 2017 .

Short Answer

Expert verified
Overall, China's one-child policy might have led to a decrease in demand for children's items like clothing and toys, but a possible increase in demand for high-quality education services. Additionally, a skew towards male births could have influenced demand patterns within these categories, leading to a higher demand for boys' clothing and toys, or educational services targeted towards male children.

Step by step solution

01

Identify the demographics changes

From 1979 to 2015, China's one-child policy resulted in two significant demographic shifts: a decrease in the population under 14 from 36% to 17%, and an increase in the number of male children relative to female children.
02

Choose relevant goods

Typically, some goods are more popular among certain age groups or genders. To think about how the demand might have changed, we'll select three goods which are primarily consumed by children or show a significant difference in consumption patterns between genders. For this explanation, we'll choose the following goods: children's clothing, toys, and education services.
03

Analyze the impact on children's clothing

With a decrease in the child population, the demand for children's clothing is likely to have decreased over this time period. Additionally, with more boys being born than girls, there might be a higher demand for boys' clothing compared to girls' clothing.
04

Analyze the impact on toys

A similar analysis applies to toys: the overall demand for children's toys would likely have decreased. Also, traditionally 'boy' toys may see a higher demand given the skewed gender ratio.
05

Analyze the impact on education services

With fewer children to invest in, Chinese parents may have been willing to spend more on the education per child, potentially raising the demand for high-quality educational services, private tutoring, and extra-curricular activities. A gender bias towards male children could also influence the types of educational services in demand.

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Most popular questions from this chapter

State whether each of the following events will result in a movement along the demand curve for McDonald's Quarter Pounder hamburgers or whether it will cause the curve to shift. If the demand curve shifts, indicate whether it will shift to the left or to the right and draw a graph to illustrate the shift. a. The price of Burger King's Whopper hamburger declines. b. McDonald's distributes coupons for \(\$ 1.00\) off the purchase of a Quarter Pounder. c. Because of a shortage of potatoes, the price of French fries increases. d. McDonald's switches to using fresh, never-frozen beef patties in its Quarter Pounders. e. The U.S. economy enters a period of rapid growth in incomes.

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