Far from being lauded as a virtue, China’s high savings rate has been blamed for the economic imbalances underlying the global financial crisis. The criticism being that the Chinese spend too little and rely too much on exporting to Western consumers.
But in their intriguingly named paper, ‘A Sexually Unbalanced Model of Current Account Imbalances‘, New York-based researchers Du Qingyuan and Wei Shang-Jin suggest China’s gender imbalance could also be a significant factor in the persistence of its high savings rate.
The pair argue that intensifying competition in the Chinese marriage market is causing men — or indeed parents with sons — to raise their savings rates to improve their relative allure among a shrinking pool of potential brides.
A draconian one-child policy, coupled with a traditional preference for male offspring and the availability of selective-sex abortion, has left the country of 1.3 billion facing its most serious demographic crisis.