China must solve its daughter deficit

What is most precious in China today? Is it a house, a car or a big bank account? It is none of the above. Arguably, baby girls are what the country needs most.

China has one of the world's most highly skewed sex ratios: for every 100 baby girls born in 2009, 119.5 boys were born. By 2011, the ratio had fallen to 117.8 boys for every 100 girls, suggesting a possible decline - an improvement in this instance. But the ratio is still very high by the standards of the developed world.

This gender imbalance is a product of centuries of gender inequality in traditional societies, where boys have always been preferred over infant girls.

Such inequality in emerging markets was the theme of this year's annual Emerging Markets Symposium held at Oxford University.

The cultural preference for baby boys in many traditional societies, when coupled with modern technology such as ultrasound and easy sex-selective abortions, has led directly to the imbalanced sex ratio at birth in China and India. Recent evidence also shows that more female fetuses are being aborted in Europe than previously thought, especially in the Balkans.

According to demographers, a male-to-female sex ratio at birth of about 106:100 is the current norm, as the mortality rate among male infants and children tend to be higher than among girls.

That ratio at birth would normally yield a ratio of roughly 1:1 at marriage age. But a ratio of 118:100 will result in a sizeable surplus of men at marriage age. According to China's National Bureau of Statistics, by 2020, Chinese men of marriageable age will outnumber women by 24 million.

Such a gender imbalance is likely to have serious social, economic and political consequences.

First, it will lead to what is known as hypergamy, that is, the allocation by China's marriage market of available potential wives - who are millions fewer than men seeking wives - to men with higher incomes and social status.

These choices leave millions of men in the lower socio-economic strata without wives. This outcome can lead to acute social discontent and disharmony - just the opposite of what the Chinese government wants to achieve. Social discontent among poor, unattached young men can have serious political consequences in a country with high income inequality, as is currently the case in China.

Second, when these permanent bachelors reach old age, they will lack the support of wives and children. A 2010 World Bank paper by Monica Das Gupta, Avraham Ebenstein and Ethan Jennings Sharygin points out that these unmarried men are likely to be concentrated in low-income provinces without the means to provide for the needs of the elderly, which again could be socially and politically destabilising.

Third, it is well known that single men in general are in poorer health than married men, and have a lower life expectancy than married men. That problem is exacerbated by the fact that the condemned bachelors tend to be poor.

Finally, of course, this gender imbalance has a devastating human dimension, as sexual fulfilment, procreation and the gratification of a good family life are fundamental aspirations of all human beings.

What could public policy do about it? One approach might be to outlaw the abortion of baby girls. Such a law could easily be written and passed, but it may not be easily enforceable in China.

The government could also extend to urban couples the policy that allows a second try for families whose first child is a girl but who really want a boy. China's population is rapidly ageing and will soon need more young people anyway.

A third and probably more effective approach might be to pay families a sizeable bonus for the birth of a baby girl - the equivalent of pay-for-performance in health care where providers who deliver superior care to patients are rewarded financially. Paying a public bonus for baby girls could easily be defended on the grounds of a common social good.

Economic theory, supported by empirical evidence, suggests that often it is easier to change human behaviour through targeted financial incentives than simply to forbid unwanted behaviour. For example, it has been easier to discourage smoking by raising cigarette taxes, especially among young people who can less afford pricier brands, than through outright prohibitions.

As China's welcomes its new government under President Xi Jinping , it is a propitious time to focus on the problem of gender-ratio imbalance, with its tragic human consequences and social, economic and potentially political fallout.

China is well into its 12th five-year plan starting in 2011, which among other things called for deepening the reforms of the previous five-year plan aimed at establishing a "harmonious society" so that all Chinese may enjoy the fruits of China's spectacular economic growth in the past 30 years. Eliminating the human tragedy of the gender imbalance is an essential component of a harmonious society.

Tsung-Mei Cheng is a health policy research analyst at the Woodrow Wilson School of Public and International Affairs, Princeton University, and co-founder of the Princeton Conference