Facilitating fertility decline through economic development: a principal-agent analysis of local bureaucratic incentives in China's fertility transition

Despite close associations, political science had weak explanatory power for fertility transition. It often depicts the political processes of fertility transition as direct and coercive policies and mechanical execution without consideration of indirect bureaucratic processes. Drawing on principal-agent and economic-driven theories, this study established a novel model using 1980–2000 Chinese provincial panel data: local officials facilitated fertility decline through economic development for career advancement. System generalized method moments (GMM) and ordered logistic regression (OLM) results showed: (1) gross domestic product (GDP) per capita growth (OR = 0.012) and total fertility rate (TFR) decline (OR = 0.026) increased promotion odds, while excessive TFR decline (over 37% within one term) decreased it; (2) the critical age (59) and tenure year (one year before leaving office) positively associated with GDP per capita, industrialization, and lower TFR; (3) GDP per capita and industrialization negatively associated with TFR. Facilitating fertility decline via economic development was an efficient, low-risk strategy for local officials compared to radical birth control campaigns. It was the first study applying principal-agent theory to explain how bureaucratic processes enabled fertility transitions. It combined political and economic-driven theories on fertility transition, advancing political demography and refining the social science paradigm on fertility transition.

Shengyuan Liang, Shanmin Liu, Canmian Liu