In China, Women Control the Budgets

by JT McGee

Who wears the pants? The question of the modern couple, right? The one who wears the pants makes the rules, controls the budget, and is the kingpin of the home. But we all know what is going on in the United States, so let’s look overseas, where government policy has actually created a shift in family budgets.

The Economist reported in March that it may be China’s infamous “one-child policy” that is pushing the nation toward a financial crisis. The skewed male-to-female ratio is, as Shang-Jin Wei says, a reason for global trade imbalances between China and the rest of the world. According to the Columbia professor, a one-child policy creates a necessity to save, and is the reason why the Chinese are so good at stockpiling money.

The male to female ratios across the world point toward more social unrest.

From Wikipedia. Blue hues indicate an overly female populace. Red indicates a male-dominated population ratio.

The Economics of Sex

The simple and unfortunate reality is that Chinese families can have only one child. The result is that since the 1980s, the majority of children born to Chinese families have been male. No, it isn’t that the Chinese are really good at beating 50/50 odds; instead they’re just really good at abortions.

BusinessWeek reported that a 2002 survey reflected that more than 300 females from a sample of 820 admitted having an abortion, more than 100 said that they were attempting to pick the sex of their single child. The same article from MSNBC notes that a mobile “sex scan” is available on the street for the cost of $50.

In rural China, the statics are scarier. Rural Chinese provinces and cities allow for couples to have as many as two children (Wow! Two!), and the ratio in these areas for the second child is as high as 143 males to 100 females, according to the NY Times. If you miss on the first try, try again!

The male to female ratio in China has skyrocketed from 1.06:1 in 1980 to 1.22:1 by 1997. The CIA world factbook—when it comes to intelligence, I’m not doubting the CIA—reports that the current ratio is 1.133 males to females at birth, 1.17 males to females under 15 years old, and 1.06:1 at 15-64 years old. Do the calendar subtraction and you can see quite plainly the profound effect of the one-child policy.

Sex and Social Study

In economics and in humanities, the role of gender and sex is incredibly important. Economists and staticians have gone so far to quantify that female waitresses with C-cup sized breasts receive the highest tips from male customers, according to a study published in The Archives of Sexual Behavior. Well, maybe it could be that those who self-report a C-sized breast are likely to lie about how much they receive in tips. Whatever!

At any rate, the reality is that 11% of Chinese men born in this generation will go without a wife. In order to find wives for their children, Chinese parents turn to accumulate wealth as quickly as possible. They’re spending more on education, and building cash stockpiles so that their son is attractive in a competitive marriage market, so to speak.

Interestingly, it was in 2009 that the male-to-female ratio in China finally declined amid a global recession to 119 males to every 100 females. Shortly thereafter, China reported its first trade deficit.  I’m not claiming a causual link, but the correlation is interesting:

Chinese historical trade surpluses by month and year.

China’s Future

History isn’t so kind to gendercide; in many cases, it sparks eventual societal unrest when a disproportionately large male or female populace realizes they won’t satisfy the goal of all organisms—to reproduce.

Recently, a Chinese colleague told me he’d be taking some time off to care for his newborn daughter. I’ve known him for a number of years, so I asked about the one child policy, and whether or not he would embrace the idea of gender selection.

He replied, “JT…if there’s one thing I know, it’s that you never F___ with nature.” I couldn’t agree more.

{ 6 comments… read them below or add one }

Super Frugalette May 11, 2011 at 12:39

I think it is very astute of you to see that when there are fewer women than men, women have greater bargaining power when it comes to choosing a mate. Their power will not only lie in their ability to choose a mate, but in the relationship as well, since the husband will fear that if he does not “give in” to his wife…then she may choose another husband. Hence, women will control the budget.


JT McGee May 11, 2011 at 16:50

Women absolutely control the budget in China for both families and in the aggregate national savings rate. If women weren’t in such short supply, it is argued that Chinese families wouldn’t have as much reason to save.

I think I may have to explore this further and see how local Chinese consumption has shifted over time. I have a feeling that family purchases in China will reflect a change toward female-centric purchases as the lag in the one-child policy passes and observable data emerges.

I’m nerding out today, for real.


Invest It Wisely May 12, 2011 at 14:15

Interesting connection between the gender imbalance and need to save. Large imbalances are definitely a precursor to social unrest but then what can you do when you have a one child policy. On the other hand the restraint in population growth has arguably led to a richer (and perhaps more controllable) society than unrestrained growth would have.


JT McGee May 12, 2011 at 15:47

Probably so in the short-term. Long term, China has serious problems in their dependency ratio; too many people won’t be working while too few do. What is happening in China is monumental, and I consider myself to be lucky to be able to study it.


Geek May 15, 2011 at 18:37

Or instead of being in charge of the budgets, women and baby girls are sold and traded. How terrifying to live in a male-dominated society where you have become even MORE of an item of 1 type of value (ovaries).


As for the soundness of social programs… well it’s the price we pay for breeding so much a generation or two ago. The USA is lucky to have so much immigration.


JT McGee May 15, 2011 at 20:12

I read different articles about the sex trade; truthfully, I disliked reading them so much I couldn’t even care to include them. It is truly awful, really.

Are you from China? Do you currently live there, or did your immigrate elsewhere? I’d like to hear your story…assuming it is safe to share.


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