Assessing the impact of social factors on the sustainable economic development of China and its regions

This study examines the extent and nature of the impact of social factors on the sustainable economic development of China and its regions. Thus, based on the entropy method, the integral index of China's sustainable economic development was calculated, which became an explanatory variable in the regression analysis. The regression analysis of panel data of 30 Chinese provincial-level administrative regions covering the period from 2012 to 2021 resulted in the construction of three fixed-effect models showing the relationship between each of the socially-oriented dependent variables, as well as their totality, and sustainable economic development. The type of models was selected using the Hausman test and, to ensure reliability, an analysis of both the overall sample and its regional heterogeneity was carried out in addition to the reliability tests. According to the results of the study, one of the social factors (aging of the population) can contribute significantly to China's economic stability. At the same time, the second social factor – the growing participation of the population in pension insurance – has a negative impact on the Chinese economy. The combination of these factors does not have a significant impact on China's sustainable economic development. The study also shows that the impact of the social factors analyzed on economic sustainability differs in the eastern, central and western provinces of China. Based on the empirical results of the study, the following recommendations are proposed for China's sustainable economic development in the face of social challenges (aging of the population): to expand the use of the consumer potential of the senior population, and to develop this group as human resources; to promote the rational distribution of the factors of production among provinces by coordination of the state's regional policies. These recommendations can be used by the government to formulate a strategy for the sustainable economic development of China and its provinces. The research results will also be beneficial for businesses aiming to adapt their corporate environment to emerging realities and trends.