China's Skewed Sex Ratio Is Boosting The Country's Trade Surplus

REUTERS/Barry HuangContestants watch a video of a male contestant on electronic screens during the recording of an episode of popular Chinese matchmaking television show "If You Are the One" in Beijing September 24, 2011.

China's decades long one-child policy and preference for male children has skewed the country's demographics.

The country has too many men.

However, this skewed male-to-female ratio may be what's partly responsible for China's huge trade surplus.

According to the first chapter of the Oxford Companion to the Economics of China, published by the NBER, China's skewed sex ratio is partly responsible for its high domestic savings rate.

Fewer women in the marriage market have made Chinese women pickier. One female contestant on a Chinese dating show famously said "I'd rather cry in a BMW than smile on a bicycle". For a man to get hitched, a good education and stable income is no longer enough and owning property has become almost a necessity.

This gender imbalance has caused young men and their parents to increase their savings. From the paper:

However, this could change with the recent abolition of the one-child policy, as the sex ratio normalizes and parents feel less pressured to save to find their son a wife.

Read the whole study at NBER.org