China is to give RMB3600(~USD500) as an incentive for families to have children. However, since China lift the “one-child” policy in 2016, new births have actually halved over the past decade. If the reason of not having kids is financial, then 500 dollars as a birth incentive are way too little. To raise a kid to 18, some estimate the total cost would amount to a few million RMB. If the reason of not having kids is non- financial, then whether to give 500 bucks or not won’t make a difference. As such, this incentive will likely fail, and new births will likely continue to fall, the population will likely continue to shrink. Back then, the Chinese reared kids against old age. It’s like an investment for the future. Now, the Chinese are not having kids cos it’s too expensive. Then it’s like saving for the future. Such behavior is consistent with the prevalent risk aversion in the economy now — everyone is saving rather than investing. There is no easy solution to resolve this social challenge. But something is better than nothing. And better late than never. While 500 bucks won’t change much, it’s a start.