1.In the present-day world，there exits two kinds of population issues，belonging to two kinds of cycles between different population and economic deve-lopment. One is categorised by a population surplus，belonging to the high fertility rate—low labour productivity—high fertility cycle model；the other is categorised by a demographic and labour productivity deficiency，belonging to the low fertility rate—high labour productivity—low fertility rate cycle model. The latter could be seen as the high-level cycle model of the population and economic development. However，taking the world as a whole，among the world population of 1990，that of the developing countries accounted for about 77.2%，total fertility rate（TFR）was 4.6（not including China，the same for the following figures），birth rate was 35 per thousand，and natural growth rate was 2.4%. The per capita GNP for 1988 was 870 US ＄，basically belonging to the primitive cycle model of high fertility rate—low labour productivity—high fertillity rate. Developed countries and regions accounted for about 22.8%of the population of the world. Its total fertility rate was 2.0，birth rate was 15 per thousand，natural growth rate was 0.5%. The per capita GNP for 1988 was 15.830 US$，entering into the high—level cycle model of low fertility rate—high labour productivity—low fertility rate. Clearly，looking at the predominant aspects，the demographic problem of the world is mainly that of the population surplus，fast growth，which are not corresponding to the economic development，therefore belonging to the previous category of primitive cycle between the population and economic development.

2.China is the most populous country in the world，at the same time，a developing country. The nature of the Chinese population issue also belongs to the previous category. i.e. the stage of primitive cycle. As is known to all，before the founding of the Peoples’s Republic of China in 1949，the demographic reproduction was in a status of high birth rate，high mortality rate and low growth. Following the birth of the People’s Republic，the national economy was rapidly rehabilitated and developed，medical-care and health conditions improved，people’s livelihood enhanced and mortality rate drastically reduced. Before 1949，the mortality rate was above 20 per thousand，but decreased to 17 per thousand in 1952，and 14 per thousand in 1953，while the birth rate was still maintained at a high-level of 37 per thousand. Therefore，the natural growth rate of the population increased drastically and demographic reproduction quickly entered into the category of high birth rate，low mortality rate and high growth rate. Immediately following this，there was a baby boom in the mid-50s. Afterwards，due to several risese and falls in the national economy，and the influence of anarchy during the 10 years of chaos，measures were adopted to enforce family-planning and population control in the mid-70s. Demographic reproduction was demonstrated by a low fertility ebb in 1958-1961，another baby boom in 1962-1973，another low fertility ebb in 1974-1985 and a new baby boom starting from 1986 and will last into 1997 or later. Although drastic changes happened in birth rate，mortality rate and natural growth rate in the past 40 years or more，the present population growth rate in China belongs to the lowest category among the developing countries. However，the total population（not including Taiwan，the same for the following figures）increased from 541，670，000 in 1949 to 1，143，330，000 in 1990，a net growth of 601，660，000 in 41 years’ time with an annual average growth rate of 1.84 per thousand，still tended to be high. Indeed，remarkable successes achieved by the state in the mid-70’s to vigrously control the population growth and enforce the family-planning have laid cornerstones for the population and economic development to change from the primitive cycle into the high-level cycle. However，on one hand，China has a weak economic foundation，despite of the great changes taken place in the 41 years，the productivity is still not developed；on the other hand，the population has increased by folds，which has consumed a part of the newly-added national income to a large extent，and putting us basically into a stage of primitive cycle of the population and economic development. If the past “6th Five-Year-Plan” and “7th Five-Year-Plan” were considered to be the 10 years with fastest growth in the national wealth and largest attainment of tangible benefits for the people，GNP calculated in terms of the price of that year，was increased from 447，000 million RMB Yuan in 1980 to 1，740，000 million RMB Yuan in 1990；an increase of 1.36 times in terms of comparable price；at the same time，national income increased from 368，800 million RMB Yuan to 1，430，000 million RMB Yuan，an increase of 1.3l times in terms of comparable price. However，due to an increase of the population from 987，050，000 to 1，143，330，000 during the same period，which was an increase of 15.8%，the GNP was only increased by 1.04 time in terms of comparable price.32%of the newly-increased GNP was divided up by the newly-added population；per capita national income was only increased by 99.17%，the remaining 31.8% was also derided up by the newly-added population②. Although there was a rather large decrease in the birth rate and natural growth rate in past 10 years in the “6th Five-Year-Plan” period，the annual average growth rate was decreased to 1.41%and in the “7th Five-Year-Plan” period，it was decreased to 1.55%. However，in general，we still could not rid ourselves of the passive situation with population squeezing the productivity，nor could we extricate ourselves from the primitive cycle of the population and economic development.

3.Here，a question calls for discussion，i.e. the defintions of the per capita GNP，national income and other quotas in China and the problem of making international comparisons. If in terms of exchange rate between RMB and US ＄，100 US $ in 1980 was equivalent to 160 RMB and 100 US $in 1990 was equivalent to 520 RMB，then the per capita GNP for 1980 was 283 US$；and per capita national income was 234 US$；the same for 1990 was 293 US $ and 241 US $ respectively. Therefore，in 10 years time，the per capita GNP was only increased by 10 US$，an increase of 3.5%while per capita national income was only increased by 7 US$，an increase of 3.0%，it is apparently not compatible to the reality. This is mainly caused by a continuous downward adjustment of RMB against foreign exchange rate. If taking the comparable price of 1980，the per capita GNP should be 577US$and national income 465 US $ for 1990 in China. Due to the irrationality in comparable price，estimations from home and abroad on China’s per capita GNP and national income vary greatly，some even drastically different，ranging from 300 US $ per capita to 1，000 US $ per capita. However，according to the materials provided by the Population Advisory Bureau of U.S.A. in “World Population Data 1990”，the per capita GNP in developing countries and regions has already reached 870US $ in that year with China ranking in the medium 1evel or between the medium and rather low level among the developing countries. With a low labour productivity，China is in transition from high fertility rate low labour productivity—high fertility rate cycle model to low fertility rate—high labour productivity—low fertility rate cycle model，but basically belonging to the previous stage of primtive cycle model.

4.Then，how could the transition be accelerated and a path be found to obtain a virtuous cycle of the population and economic development？From the concrete conditions of China，it is of paramount importance to vigorously develop the economy and to strictly control the population growth and combine closely these two factors. Here，certain analysis will be made on how to control the population growth through economic means in the main and by combining the above-mentioned two factors.

5.Historical materialists consider that existance determines consciousness，productive forces determine production relations and economic foundation detemines superstructure. Demographic changes are finally determined by economic changes. In the final analysis，population issue is that of the economic issue. The two possible cycles between the population and economic development mentioned above are finally determined by the level of social economic development besides different traditional and cultural influences of various countries and their different population policies. The fundamental reason for the high fertility rate—labour productivity—high fertility rate cycle model of the population and ecomomic development is due to the fact that under the condition of a low level of productive forces，high fertility can bring greater economic results to the parents and family. Here it is necessary to explain，in a general way，the theory of beneficial results—the costs of upbringing the child. Since the outbreak of the bourgeois Industrial Revolution，and with the establishment of capitalist productive relations and the development of the overall commodity concepts，some micro-demographic economists look at demographic reproduction from the perspectives of commodity production，putting forward the theory of beneficial results—the costs of upbringing the child. They indicate that the production costs for a child could be composed of two parts：direct cost，i.e. direct money expenses to raise a child and indirect realistically significant to reveal the universal law of economic dominance over fertility behaviour. The important aspect of the universal law is the transition from the primitive cycle into the high-level cycle，and change of child cost-benefit theory during the transitional stage. On the issue of cost，under certain conditions in the level of social productive forces，direct or indirect costs on the basic living expenses of the child and during pregnancy and delievery time remain relative stable，constituting constant costs or quantitative costs of the child；while expenses of medical-care to enhance the physical quality of the child and that of education to raise his cultural quality are increasing continuously，constituting variable costs or qualitative costs of the child. On the issue of benefit，due to technological advancement and the increase of economic income of the parents and family，which does not mainly depend on the increase of the quantity of the labour force，but on the improvement of their quality，sophisticated labour increases cost，i.e. time spent on the child by the parents，especially the mother which reduces their income. However，the child is also beneficial to the parents，most importantly his labour-economic benefit；support for their old age-insurance benefit；consumption-entertainment benefit；benfit of inheriting the family property，risk-taking benefit to revitalize the family business and benefit of providing security and safeguard. Among the 6 benefits，the first 3 are most important. Then，whether the parents want benefits，the first 3 are most important. Then，whether the parent want to produce an edge child would depend on the cost benefit put into the child：if cost is larger than benefit，they feel it unnecessary and if cost is smaller than benefit，they would feel the necessity. Cost versus benefit would depend on random factors. It should be pointed out that the child cost-benefit theory has its limitations and different schools of the bourgeois demographic economists have different views. However，by linking the human fertility behaviour with economic gains and losses and making quantitative studies，it is by folds against simple labour. The economic benefit of labour from the edge child is constantly decreasing. How is the support for the old-age-insu-rance benefit from the child？On one hand，due to social economic development，it becomes possible for the state to allocate more capital on the social security works for the aged；on the otherhand，with the social economic development and increase of the family income，people have already accumulated a deposit of old-age pension before they enter into the old-age，so as not to rely on their chidren for support；thirdly，the goverment carries out an universal pension system by combining social pension support with private deposit，an old—age pension fund would be set up by the government，enterprise and individual to contribute a certain part of their capital to the fund，thereby reducing rapidly the insurance benefit from the child to support the old. Others like inheritance benefit benefit to reshape the family business and benefit of security and safeguard also tend to decrease to various extent with the social economic development. There is no definite conclusion only no consumption-entertainment benefit，the changes in this respect are not very clear. Therefore，from the perspectives of development，drastic increase in child costs，especially the qualitative cost of child，notable decrease in child benefit，especially economic benefit，and people’s choice prone to change from quantitative cost or constant cost of the child to qualitative cost or variable cost of the child have enabled fertility rate to decrease，and will gradually accomplish the transition from high fertility rate—low labour productivity—high fertility rate into low fertility rate—high labour productivity—low fertility rate drastically reducing the birth rate of the population.

6.As discussed above，in general，the present-day China is in a stage of primitive cycle of the population and economic development and the production of one more edge child can bring clear economic benefits. However，I believe，due to the vast territory of China，and rather imbalanced economic，cultural and social development，great differences exist between the cities and countryside and among the regions. Developed cities and regions have already entered into the stage of high level cycle while certain regions are in the transitional period into the high—level cycle. This could be seen in the following chart，showing the relationship between per capita national income and birth rate of the population.

Fig 1 Per capita national income and birth rate in different regions in China.1989.

Sequence indicated in the chart from left to right：Guizhou，Guangxi，Yunnan，Tibet，Sichuan，Jiangxi，Henan，Gansu，Shaanxi，Hunan，Anhui，Ningxia，Inner Mongolia，Shanxi，Oinghai，Hebei，Hainan，Hubei，Fujian，Jilin，Shandong，Heilongjing，Jiangsu，Zhejiang，Guangdong，Liaoning，Tianjin，Beijing，Shanghai，Xinjiang（absent）

7.In chart 1，axle X represents the per capita national income，axle Y represents the birth rate of the population，curve BG is the regression model which indicates the change of the national（except Taiwan and Xinjiang）birth rate Y with the change of the per capita national income X. In 1989，the per capita national income of China was 1，189 RMB yuan. Besides Xinjiang，11 provinces and cities under direct jurisdiction of the central Government such as Shanghai，Beijing，Tianjin，Liaoning，Guangdong，Zhejiang，Jiangsu，Heilongjiang，Shandong，Jilin，and Fujian had a higher average national income. The other 18 provinces and autonomous regions were below the national average level. The birth rate of the population for the whole country was 20.83‰. For the 11 provinces and cities under the direct jurisdiction of the Central Government which had a higher per capita national income，with the exception of Fujian，the birth rate of the 10 provinces and cities was below the average national level. Among them，the per capita national income of Shanghai reached 4，599 RMB Yuan and birth rate decreased to 12.53 per thousand：the per capita national income of Beijing was 3，248 RMB Yuan and birth rate 12.84 per thousand：that of Tianjin 2，738 RMB Yuan and birth rate 15.48 pre thousand respectively；that of Liaoning 1，989 RMB Yuan and birth rate 15.04 per thousand respectively；that of Zhejiang 1，660 RMB Yuan and birth rate 15.20 per thousand respectively，it was not only Beijing Tianjin and Shanghai as cities under the direct jurisdiction of the Central Government，whose per capita national income clearly proved to be in negative relationship to the birth rate，but also developed regions，especially the coastal developed provinces demonstrated the similar situation with clarity. For the regions which had a per capita income below the national average level，in general，their birth rate was hig-her. Among the 18 provinces and autonomous regions whose per capita national income was below the national average level，12 of them had a higher birth rate than the national level，e.g. per capita national income for Yunnan was 771 RMB Yuan，and birth rate reached 23.07 per thousand；per capita national income for Tibet was 778 RMB Yuan，and birth rate was 24.17 per thousand；per capita national income for Henan was 836 RMB Yuan and birth rate was 24.25 per thousand. However，due to the impact of the demographic age structure，or relative good results from implementing the population policy or other economic，social and cultural factors，there were 6 provinces and automonous regions whose per capita national income was below the national average level and their birth rate was also below the national level. Nevertheless，from a general survey of the 29 pro-vinces，autonomous regions and cities under direct jurisdiction of the Central Government indicated on the chart，it is very clear to see the negative relationship between per capita national income and birth rate of the population. Its correlation coefficient is-0.764，belonging to the scope of strong correlation. The general tendency is，higher the per capita national income，lower the birth rate of the population；the reverse is lower the per capita national income，higher the birth rate of the population. The regression model of the changes in birth rate with the per capita national income is indicated by curve BG：

Y=-0.318X+24.648

8.Due to strong correlation existing between birth rate and per capita national income，and vast difference in per capita national income between cities and countryside and among regions such as the per capita national income of Shanghai in 1989 was 3.7 times that of Fujian，5.1 times that of Anhui，and 7.4 times that of Guizhou，different stages of cycle exist in population and economic devlopment. At present，in extra-large cities like Beijing，Tianjin and Shanghai or in large or medium cities with rather developed economy and culture，or in a small number of medium and small cities and a few village townships rapidly grown up during the reform and opening-up，the costs to bring up one child，mainly that of variable costs or qualitative costs of the child increase drastically while the labour-economic benefit and support for old-age-insurance benefit from the edge child remarkably decrease. Special emphasis should be made about a decrease in seeking support for old-age-insurance benefit from the child，which constitutes the initial motivation for continuous fertility at present. Due to the fact that these regions have basicaly solved the problem of old-age social securities，popularized the system of setting up a pension fund and eliminated apprehensions in old-age support and securities in a fundamental way，solid foundation could be laid for family-planning and eugenics. Such cases could be easily found in almost all the cities and they also exist in some of the economically developed rural townships. The author made an inspection tour to the South of Liaoning Province in October 1990. Examples could be cited about Sifangtai Village，East Anshan Township in Anshan city. The village has 280 households with a population of 1，004. The whole village live in a large compound consisting of 7 building blocks with 7 storeys. The buildings are fully equipped with running-water and gas-cookers similar to that of the Anshan city proper. The situation is even better than some of the residential quarters of certain institutions and enterprises. The per capita income of the whole village is 1，596 RMB Yuan. The rent for the housing is covered by the township with many other special treatments. Male retires at 60 years old and female at 55. They are given a 330 Yuan pension allowance per year after retirement. Plus their previous savings，they are free from economic apprehensions in their old-age. Under such circumstances，support-benefit from the children decreases to a great extent. As indicated by the people there：“with running-water，we have been compensated like having half of a child.” They no longer worry about having nobody to fetch water for them. Some people voluntarily hand back the quota for allowing them to have the second child since they are single-girl families. The concept of fertility for the people there is “fewer，better and bring up a useful person.” They have realized the transfer from the input of quantitative costs on the child to that of the qualitative costs and reduced fertility rate through a natural process.

9.However，afterall，examples like the Sifangtai Village are still few. Looking at the predominant aspects，the qualitative costs or variable costs of the child have not been increased together with the economie development and income rise in the recent years，and correspondingly，the child-benefits have not been decreased either. On the contrary，disadvantageous slanting has occurred. We have seen a rapid rise in the livelihood of the residents：in the 10 years from 1980-1990，real consumption level has been increased annually by 5.9%in average. However，the costs for the edge child，especially qualitative costs or variable costs for health and education have not been correspondingly increased. Policies and mechanisms are lacking to stimulate the increase of variable costs for the child. Concerning the issue of child-benefit，on one hand，due to the implementation of contract responsilility system to link enumeration with output and the practice of township economies with individual or joint ventures，the productive and management functions of the households which were dormant for a long time in the past have been brought back to a large extent. It becomes rather urgent for the household-economy to acquire labour force，especially the male labour force，thereby enhancing drastically the labour-economic benefit of the child，and stimulating the motivation of fertility，especially the increase of the male babies.

10.On the other hand，under the old People’s Commune System in the countrysid，a set of social security mechnisms for old-age characterized in the main by “5 categories of households under favourable treatment scheme” and “old peoples’ home” were of high standards and systematically rather comprehensive for a relatively under-developed e conomy and they played an important role in supporting the old-age people with no children or with few children. With the economic structural reform and the establishment of the new rural power structure，some of the original social security organizations for the old-age people were retained，but some of them were disintegrated or abolished. In general，they were weakened rather than strengthened. From practice，people have realized that relying on the children for old-age，at present circumstances，is still the best way with greatest security coefficient，and supporting the old-age by the children-insurance benefit has also increased in value.

11.The above-mentioned disadyantageous slanting of the costs of child-benefit in most of the countryside and economically under-developed townships provides clear economic benefits to produce one more edge child，stimulates initiatives in fertility and seriously hinders the population and economic development from trandition into the high-level cycle. However，from the point of view of the dialectic materialists，the hindrance meanwhile also contains elements to eliminate the hindrance itself. The method is to find ways to increase the costs of the children，mainly the qualitative costs and to reduce the child-benefits.

12.Concerning the costs of the children，first，it is necessary to raise the costs on extra children. Adequate consideration should be given to inerease the penalty for extra children. The old once-for-all penalty practice for extra children should be changed and the time of penalty should be about 14 years，as long as the bonus for the single-child families. The amount and time of the penalty should serve one general objective：making the parents of the extra children realize clearly that the costs they spend on their extra children could not be fully compensated by the benefits from their future children and that costs are greater than benefits. Secondly，it is necessary to effectively raise the qualitative costs of the children，especially educational expenses on children be steadily increased. Relevant policies and mechanisms need to be readjusted to correspondingly compensate or even double the compansation of the intellectual investment on the children by parents.

13.Concerning the issue of child-benefit，firstly，it is necessary to raise the benefit of the single-child or children within family-planning system to their parents. Due consideration should be given to increase the bonus on the single-child and guarantee to honour the commitment on time. At the same time，labour market should be developed to provide labour services to no-children or single-child families or social communal services could be developed to make up for the loss in labour-economic benefits due to no-children or few children situations. Measures and methods should be adopted to gradually carry out an old-age security system to the parents of the single-child or children within the family-planning scheme including changing the single-child bonus into a pension fund or providing insurance to the single-child to raise the supporting old-age-insurance benefit of single-child or children within family-planning scheme. Considerations should also he made to provide preferential policies to the single-child such as enrollment in nurseries and schools. Employment，transfer the rural household registration into non-rural status，allocation of housing，etc and to create a rather favourable external circumstance to the growth of the single-child and to enhance his risk-benefit to inherit the family business and maintain the family status. Secondly，through necessary restrictions on enrollment into nurseries and schools，employment，transfer rural household registration into non-rural status，allocation of housing，etc. on extra-children，their labour-economic benefits and supporting the old-age-insurance benefits to their parents would be reduced and it remarkably weakens the benefits of the edge child，not sufficient to make up for the costs which the parents spend.

14.It must be pointed out that corresponding policies and measures adoped towards child-costs and child-benefits discussed above are the key to a virtuous cycle of the population and economic development. This is extremely important for the 90’s as a whole starting from 1991. However，we should never forget that the eco-nomy is the base and the continuous development of the national economy is only the foundation to enter into a virtuous cycle. It is only the continuous development of the national economy that could raise a higher demand on the labour force，thereby on the qualitative costs of the child and for people to be able to increase the qualitative costs of the child. Meanwhile，only when the economy is developed，tool of production improved，the quality of the labourers appearing to be more important than the quantity，can the labour-economic benefit of the child be gradually reduced；and only when the economy is developed，and when society，enterpries and labourer himself are capable of setting up a fund as future deposit for the old-age，can supporting the old-age-insurance benefit of the child be rapidly reduced. Therefore，continuous development of the economy serves both as the basis for effectively raising the costs of the marginal child，and also the basis for reducing various benefits of the child. From this point of departure，to ensure a stable，sustained and coordinated development of our national economy is not only the central task to realize the second-stage strategic objectives of the next 10 years，but also highly relevant to realize the transfer from high fertility rate—low labour productivity—high fertility rate to low fertility rate—high labour productivity—low fertility rate. It is the objective foundation to achieve，the virtuous cycle of the population and economic development.