Impact Analysis of Population Aging on Public Education Financial Expenditure in China

Abstract

The problem of China’s aging population is becoming increasingly serious, which brings a variety of social and economic issues. This paper constructed the theoretical framework and analyzed the impact mechanism of the population aging on local public education financial expenditure, and selected provincial panel data from 2010 to 2020 for empirical testing. It is found that population aging has a significant negative impact on local public education financial expenditure, and that with every 1% increase in old-age dependency ratio, local public education financial expenditure will decrease by 0.304%. The increase of urbanization rate has a significant positive impact on local public education financial expenditure, and with every 1% increase in urbanization rate, the local public education financial expenditure will increase by 0.215%. The test of impact mechanism shows that local government fiscal revenue and public expenditure for the elderly has the mediating effect in the impact of population aging on local public education financial expenditure, and the mediating effect of public expenditure for the elderly is stronger. The conclusions of the research can help provide policy implications for solving the declining level of local government public education financial expenditure in the context of an ageing population, and provide theoretical support to improve the rational allocation of fiscal public expenditure.