TY  - UNPD
A1  - Donaldson, John
A1  - Koulovatianos, Christos
A1  - Li, Jian
A1  - Mehra, Rajnish
T1  - Demographics and FDI : lessons from China's one-child policy
T2  - Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 613
N2  - Following the introduction of the one-child policy in China, the capital-labor (K/L) ratio of China increased relative to that of India, and, simultaneously, FDI inflows relative to GDP for China versus India declined. These observations are explained in the context of a simple neoclassical OLG paradigm. The adjustment mechanism works as follows: the reduction in the growth rate of the (urban) labor force due to the one-child policy permanently increases the capital per worker inherited from the previous generation. The resulting increase in China's (domestic K)/L thus "crowds out" the need for FDI in China relative to India. Our paper is a contribution to the nascent literature exploring demographic transitions and their effects on FDI flows.
T3  - CFS working paper series - 613 
KW  - Lucas paradox
KW  - capital-labor ratio
KW  - FDI-intensity
KW  - one-child policy
Y1  - 2018
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/48018
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-480187
UR  - https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3289940
IS  - Revised November 1, 2018
PB  - Center for Financial Studies
CY  - Frankfurt, M.
ER  -