Population aging and endogenous economic growth

We investigate the consequences of population aging for long-run economic growth perspectives. Our framework incorporates endogenous growth models and semi-endogenous growth models as special cases. We show that (1) increases in longevity have a positive impact on per capita output growth, (2) decreases in fertility have a negative impact on per capita output growth, (3) the positive longevity effect dominates the negative fertility effect in case of the endogenous growth framework, and (4) population aging fosters long-run growth in the endogenous growth framework, while its effect depends on the relative change between fertility and mortality in the semi-endogenous growth framework.     

Cohort Replacement and Homeostasis in World Population, 1950–2100

Using a simple empirical approach, we analyze world and regional‐level cohort replacement as determined by the key components of population dynamics, i.e. fertility, survival, and migration, for 1950–2010, using UN data. We define two kinds of homeostatic relationships among these components: fertility responses to mortality change (type I) and migration responses to changes in net reproduction (type II), and show that both can be observed to some degree in this period. We examine the extent of cohort replacement embodied in the medium‐variant UN population projections over 2010–2100 and consider how the international migration assumptions made in such projections would be affected by a homeostatic perspective.     

Demographic transitions: analyzing the effects of mortality on fertility

The effect of mortality reductions on fertility is one of the main mechanisms stressed by the recent growth literature in order to explain demographic transitions. We analyze the empirical relevance of this mechanism based on the experience of developed and developing countries since 1960. We distinguish between the effects on gross and net fertility, take into account the dynamic nature of the relationship, and control for alternative explanatory factors and for endogeneity. Our results show that mortality plays a large role in fertility reductions, that the change in fertility behavior comes with a lag of about 10 years and that both net and gross fertility are affected. We find comparatively little support for explanations of the demographic transition based on changes in GDP per capita.     

The effects of demographic factors on age composition and the implications for per capita income

Multiple regression analysis techniques are used to measure the impact of variations in fertility and mortality rates on the population of labor-force age. The results of this analysis suggest that the impact of reductions in mortality on age composition are dependent on the level of mortality already attained, whereas reductions in fertility, as expected, increase the population in the nondependent age groups. The direct effect of vital rates on potential per capita income is assessed using the results of the regression equations, and such results suggest that variations in per capita income as large as 20 percent could be accounted for by variations in vital rates.     

The effects of income level,income distribution,education and urbanization on fertility rates among 28 administrative regions of China

Conflicting empirical evidence on the role of income distribution on fertility rates is the impetus for this 1982 study of providence-specific Chinese Census data, excluding Tibet. The findings support the prior thesis of Repetto but utilize the micromethods and per household income measures of the competing findings of Boulier. It is cautioned that in the Chinese analysis equal income distribution depresses fertility, but China may not reflect world wide patterns. China did not have until recently a market incentive system, and there are income measurement problems. The data are per capita economic output not per capita income, and those high output areas which did not produce low fertility may actually have had households with low incomes. The importance of this research is in establishing that cross-province data are a useful tool in understanding the influence of income distribution on fertility. As with most developing countries, women's education, for instance, at least junior high education explained the largest variation of fertility differences among the 28 provinces. The urbanization variable when controlling for income was positive, unlike the other developing countries. The 1949 Chinese government's spatial industrial policy encouraged urbanization and industrialization in rural areas and family planning programs such that highly urbanized provinces have low population density. A variety of variables on income level, income distribution, education, and urbanization are discussed. OLSQ regressions were generated utilizing such independent variables as output per capita in yuan (YOUTHPC80), the square of YOUTHPC80 (YOUTHPC802), YOUTHPC80 multiplied by the average family size in each province (YOUTHPH80), and the squared value of YOUTHPH80.     

The United Nations on World Population in 2300

The Population Division of the United Nations biennially issues detailed population estimates and projections covering the period 1950–2050. The most recent revision of these estimates and projections, the 2002 assessment, was released in February 2003. At irregular intervals, the Population Division also publishes long‐range projections. The most recent of these, covering the period up to 2150, was issued in 2000, based on the 1998 assessment. On 9 December 2003, the Population Division released the preliminary report on a new set of long‐range projections, dovetailing with the 2002 assessment, that extend over a much longer time span: up to 2300 ( http://www.un.org/esa/population/publications/longrange2/longrange2.htm ). Unlike previous long‐range projections, which, apart from China and In‐dia, were prepared for large regional groupings only, the new projections are elaborated separately for 192 countries. Given the enormous uncertainties of the character of demographic trends over such an extended period, the information content of these projections is somewhat elusive. However, they are expected to be used to provide the demographic input for long‐range models of global climate change. Long‐range population projections also serve to demonstrate the unsustainability of certain seemingly plausible assumptions as to the future course of particular demographic parameters. In the present case, for example, the high‐fertility projection, reflecting a sustained total fertility rate at the relatively modest level of 2.35, by 2300 would yield a population of some 32 billion in the countries now classified as less developed. Or, in a yet more extreme exercise 0/reductio ad absurdum, maintaining constant fertility at present rates would result in a population size of some 120 trillion in the countries now classified as least developed. Apart from the “high fertility” and “constant fertility” models just cited, the projections are calculated for three additional instructive variants: “low fertility,”“medium fertility,” and “zero growth.” Underlying each of the five variants is a single assumption on mortality change: expectation of life at birth creeping up, country‐by‐country, to a 2300 level ranging between 88 and 106 years. International migration is set at zero throughout the period 2050‐2300 in each variant. Thus the projections are unabashedly stylized and surprise‐free, providing a simple demonstration of the consequences, in terms of population size and age structure, of clearly stated assumptions on the future course of demographic variables. Reproduced below is the Executive Summary of the preliminary report on the UN long‐range projections presented to a UN technical working group on long‐range projections at its December 2003 meeting in New York and slightly revised afterward. A full final report on this topic by the Population Division of the Department of Economic and Social Affairs of the United Nations Secretariat will be published later in 2004.     

D. V. Glass on the Problems of a Declining Population

During the past quarter century fertility has dropped below replacement levels in many parts of the world. According to United Nations estimates, in 2005 this was the case in 65 countries, comprising 43 percent of the world's population. In many cases, most notably in Europe and East Asia, the shortfall of fertility from the level that would be necessary in the long run to sustain a stationary population is substantial. In Europe, for example, the average total fertility rate for the period 2000–2005 was 1.4. Indefinite maintenance of such a level implies a shrinkage of the total population by one‐third over a generation–roughly every 30 years. Accompanying that rapid decline of total numbers would be an age structure containing a preponderance of the elderly, posing extreme adjustment difficulties for the economic and social system. Societies that wish to avoid radical depopulation would have to engineer a substantial rise infertility–if not to full replacement level (slightly more than two children per woman), then at least to a level that would moderate the tempo of population decline and make population aging easier to cope with. An additional counter to declining numbers, if not significantly to population aging, could come from net immigration. This is the demographic future assumed in the UN medium‐variant projections for countries and regions currently of very low fertility. Thus, for example, in Europe over the period up to 2050 fertility is assumed to rise to 1.85 and net immigration to amount to some 32 million persons. The UN projections also anticipate further improvement in average life expectancy–from its current level of 74 years to 81 years. This factor slows the decline in population size but accelerates population aging. Under these assumptions, Europe's population would decline from its present 728 million to 653 million by 2050. At that time the proportion of the population over age 65 would be 27.6 percent, nearly double its present share. Demographic change of this nature is not a novel prospect. It was envisioned in a number of European countries and in North America, Australia, and New Zealand in the late 1920s and early 1930s. Concern with the possible economic and social consequences generated much discussion at that time among demographers and social scientists at large and also attracted public attention. Possible policy measures that might reverse the downward trend of fertility were also debated, although resulting in only hesitant and largely inconsequential action. The article by D. V. Glass reproduced below is an especially lucid and concise treatment of demographic changes under conditions of low fertility and their economic and social implications. It appeared in Eugenics Review (vol. 29, no. 1, pp. 39–47) in 1937 when the author was 26 years old. Glass's line of argument is broadly representative of the main focus of demographic analysis in the mid‐1930s on aspects of population dynamics, applying the then still novel analytical tool of the stable population model. It also echoes the work of economists then witnessing the great difficulties capitalist economies faced in adjusting to structural changes in consumer demand and labor supply. While Glass addresses these issues primarily with reference to England and Wales, he sees the issues as affecting all industrialized countries. The Malthusian problem of relentless population growth he persuasively declares to be irrelevant for these countries. The Western world faces the opposite problem: population decline, a trend only temporarily masked by the effects of an age distribution that still has a relatively high proportion of women in the child‐bearing ages, reflecting the higher fertility level of the past. A stationary population, Glass cogently argues, is to be welcomed, and he considers the absolute size at which zero growth would be achieved relatively unimportant. In contrast, a continuous population decline would have “thoroughly disastrous” results in an individualist civilization and in “an unplanned economic system.” And, he concedes, somewhat quaintly, that sustained below‐replacement fertility would pose a great problem “even in a country in which the means of production were owned communally.” Glass's conclusions about the reversibility of low fertility are as pessimistic as those of most informed observers today. Still, he sees hope in a future “rationally planned civilization” that would “produce an environment in which high fertility and a high standard of life will both be possible.” In this context, high fertility means the level necessary to sustain the population in a stationary state. By present‐day standards the level Glass calculates as needed for long‐term zero growth is indeed fairly high: 2.87 children per woman. But that figure reflects the fact that, when he wrote, mortality up to age 50 was still fairly high and fertility occurred almost wholly within marriage; it also assumes zero net immigration. In the last 70 years much has changed in each of these three components of population dynamics, both in England and Wales and in the rest of Europe. Still, Glass's commentary remains highly relevant to the discussion of the problems of low fertility today. David Victor Glass (1911–78) was associated with the London School of Economics throughout much of his scientific career. He followed R. R. Kuczynski as reader in demography in 1945 and became professor of sociology in 1948. His work on demography, population history, and population policy had already made him one of the most influential demographers in pre‐World War II Britain. After the war he rose to international prominence through pioneering work on the Royal Commission of Population; through his research on historical demography, the history of demographic thought, and social mobility; and through founding, in 1947, the journal Population Studies, which he edited until his death.     

Human capital,technological progress and the demographic transition*

We emphasize the importance to consider components of population growth — fertility and mortality ‐ separately, when modeling the mutual interaction between population and economic growth. Our model implies that two countries with the same population growth will not converge towards the same level of per capita income. The country with the lower level of birth and death rates will be better off in the long run. Introducing a spill over effect of average human capital on total productivity our model implies multiple equilibria as illustrated in Becker el al. (1990) and Strulik (1999). Besides the existence of a low and high level equilibrium ‐ as characterized by low and high levels of per capita output respectively ‐ we show the existence of multiple low level (Malthusian) equilibria. Initial conditions and parameters of technological progress and human capital investment determine whether an economy is capable to escape the low level equilibrium trap and to enjoy sustained economic growth.     

The Census Bureau on Prospects for US Population Growth in the Twenty‐First Century

The U.S. Census Bureau periodically releases projections of the US resident population, detailed by age, sex, race, and Hispanic origin. The most recent of these, issued 13 January 2000, for the first time extend to the year 2100 and also include information on the foreign‐bom population. (Earlier projections were carried up to 2080.) The extensive tabulations presenting the new set, and detailed explanation of the methodology and the assumptions underlying the projections, are accessible at the Census Bureau's web site: http://www.census.gov . A brief summary of some of the main results of these projections is reproduced below from United States Department of Commerce News, Washington, DC 20230. (The Census Bureau is an agency of the Department of Commerce.) Uncertainties as to future trends in fertility, mortality, and net migration over a period of some 100 years are very great, as is illustrated by the massive difference in the projected size of the population for 2100 in the three variants produced. The “middle” projected population figure of 571 million (which represents a growth of some 109 percent over its current level) is bracketed by “lowest” and “highest” alternative projections of 283 million and 1.18 billion, respectively. With somewhat lesser force, the point also applies to the 50‐year time span considered in the well‐known country‐by‐country projections of the United Nations. These projections are also detailed in three variants: low, middle, and high. The UN projections (last revised in 1998) envisage less rapid growth in the United States during the first part of the twenty‐first century than do the Census Bureau's. The projected population figures for 2050 in the three variants (low, middle, and high) are as follows (in millions):

Land tenure, population, and long-run growth

This paper brings together the development literature on land tenure with current research on population and long-run growth. Landowners make a decision between fixed rent, fixed wage, and sharecropping contracts to hire tenants to operate their land. The choice of tenure contract affects the share of output going to tenants, and within a simple unified growth model, this affects the relative price of food and therefore fertility. Fixed wage contracts elicit the lowest fertility rate and fixed rent contracts the highest, with sharecropping as an intermediate case. The implications of this for long-run growth depend on the assumptions one makes about scale effects in the aggregate economy. With increasing returns to scale, as in several models of innovation, fixed rent contracts imply higher growth through a market size effect. Without such increasing returns, though, fixed rent contracts reduce output per capita through a depressing effect on accumulation.     

Economic Growth and Child Undernutrition in sub‐Saharan Africa

Despite recent improvements in economic performance, undernutrition rates in sub‐Saharan Africa appear to have improved much less and rather inconsistently across the continent. We examine to what extent there is an empirical linkage between income growth and reductions of child undernutrition in Africa. We pool all DHS surveys for African countries, control for other correlates of undernutrition, and add country‐level GDP per capita. We find that a 10 percent increase in GDP per capita is associated with 1.5 to 1.7 percent lower odds of being stunted, 2.8 to 3.0 percent lower odds of being underweight, and 3.5 to 4.0 percent lower odds of being wasted. Other drivers of undernutrition, including relative socioeconomic status and mother's education and her nutritional status, are quantitatively more important. This suggests that further increases in GDP will have only a modest impact on undernutrition and broader interventions are required to accelerate progress.     

Population growth,economic development and family planning

This report discusses research conducted to determine whether reduction in population growth rates contributed to the rapid economic growth of Indonesia, South Korea, Japan and Thailand. The 5-year research projects, jointly sponsored by the UN Fund for Population Activities, the Nihon University Population Research Institute, and the East-West Population Institute, concluded that development and family planning programs contributed substantially to fertility decline in these countries. The project examined 3 factors that influence the long-term productive capacity and growth of the 4 Asian economies: savings, the size of the labor force, and the quality of labor (measured by educational attainment). Available evidence indicates a strong positive contribution of population decline toward growth of savings, a growth in labor force concurrent with a decline in fertility rates which enables per capita income to rise, and an increase in 2ndary education enrollment ratios as fertility is lowered. Development factors by themselves explain no more than 1/2 of the decline in fertility observed, suggesting that family planning programs particularly in Thailand, South Korea and Indonesia since 1976 have had an important impact on fertility and economic development.     

New Estimates and Projections of Population Growth in Pakistan

Pakistan's population growth rate rose steadily from about 2.6 percent per annum in the early 1960s to a high of about 3.5 percent during the late 1980s. Since then it has declined to an estimated 2.1 percent for 2003. Growth rates calculated from the population censuses, which show a very different picture, are distorted by differential accuracy of enumeration. During the period of rising growth rates, fertility was constant at just under 7 children per woman while life expectancy at birth rose by nearly 20 years. Fertility decline began in the late 1980s, bringing the population growth rate down with it. Remarkably, there appears to have been little change in life expectancy over the past 15 years.     

南京市人口发展对耕地保护的压力分析

逐步回归分析指出,在总人口、城市化水平、人均可支配收入、居住消费比重、交通消费比重、非农产业产值和非农产业的万元产值占地系数等变量中,总人口是南京市耕地总量变化的根本因素。总人口通过居住和就业影响耕地变化。未来一段时间,南京市总人口还将持续增加,人均可支配收入也有提高的基础,居民消费结构还要升级,这些都对耕地保护构成了压力。调节南京市人地矛盾可以考虑推行适度城市化政策,提高非农产业的万元产值占地系数,还可在耕地保护的制度上寻求创新。     

The Limits to Low Fertility: A Biosocial Approach

In light of 30 years of below‐replacement fertility in many industrialized societies, demographers are asking whether fertility could drop even further, or whether there is a “floor” below which it will not fall. A key unanswered question is whether there may be a variable biological component to fertility motivation which ensures that we continue to reproduce. Drawing on evidence from evolutionary biology, ethology, quantitative genetics, developmental psychobiology, and psychology, the article argues that our evolved biological predisposition is toward nurturing behaviors, rather than having children per se. Humans have the unique ability to be aware of such biological predispositions and translate them into conscious, but nevertheless biologically based, fertility motivation. It is likely that we have already reached the limits to low fertility since this “need to nurture,” in conjunction with normative pressures, ensures that the majority of women will want to bear at least one child. A sketch for a biosocial model of fertility motivation is outlined.     

Population Policy in a Prosperous City‐State: Dilemmas for Singapore

Singapore has achieved one of the highest levels of per capita income in the world, through sound economic planning and a stress on building its human capital. Yet its enviable living conditions are at risk of being enjoyed by fewer citizens, and indeed themselves placed in jeopardy, by the continued very low fertility levels. Ultra‐low fertility and growing reluctance by citizens to accept an increasing share of foreign‐born pose difficult dilemmas for population policy, given the planning scenario of reaching a resident population of 6.5 million. A range of pro‐marriage and pronatalist policies has failed to raise fertility substantially, while past success in modifying population trends and structure through migration has now encountered the twin problems of political constraints on the volume of immigration that is acceptable and a possible increase in emigration of Singapore citizens.     

Geopolitical Aspects of Population in the Twenty‐First Century

Over the second half of the twentieth century rapid population growth in the less developed countries has redrawn the global demographic map. Many once‐poor countries have also experienced strong economic growth, which in combination with the demographic change has yielded marked shifts in the world's economic balance, with far‐reaching geopolitical implications. At the same time, low fertility in much of the developed world presages a future of population shrinkage, accompanied by pronounced population aging. In per capita terms, the economic advantages of the developed countries will likely persist for many years, but their actual and potential falls in population may accentuate their loss of relative economic power and eventually lead to marginalization of their international standing and influence. Preventing population shrinkage will be an urgent task for them, requiring either large‐scale immigration (likely to be ruled out) or raising the birth rate. Existing pro‐family policies have had at best modest effects on fertility levels. Two novel approaches are described that would plausibly have greater impact. One would counteract the disproportionate influence of older voters in the electorate by granting voting rights to all citizens, allowing custodial parents to vote on behalf of their children. The second would reform the public pension system to reestablish the link between the financial security of retired persons and the number of children they have raised to productive adulthood.     

China's New Demographic Reality: Learning from the 2010 Census

China conducted its sixth modern census in 2010, recording a total of 1.34 billion people. This article presents an overview of the early census results. The data are of reasonable quality but contain some apparent defects where adjustments may be required. The census confirms that China has entered the era of demographic modernity and depicts the vast transformation of the country's rural‐urban distribution. Life expectancy has risen by 3–4 years in the decade since the last census, while fertility remains well below replacement—probably as low as 1.5 births per woman—and the sex ratio at birth is still significantly elevated. Low fertility and falling old‐age mortality are leading to continued and rapid population aging. Several coastal provinces grew by as much as 40 percent in the last decade, while a number of inland provinces have recorded population decline. China has reached an overall urban proportion of 50 percent.     

An empirical study of the effects of socioeconomic development on fertility rates

Recent studies by Adelman and by Friedlander and Silver, which have investigated whether regression equations derived from cross-section data can be used to predict the impact of socioeconomic development on changing levels of fertility, are reviewed critically. Regression analyses based on data for 57 countries c. 1960 show that fertility (gross reproduction rate) varies cross-sectionally with region as well as with level of development (as measured by per capita income, percent labor force in primary sector, expectation of life, illiteracy rate). Using equations derived from the cross-section study and time-series data for five European countries during the period that their fertility rates fell, it is shown that predictions about past fertility changes are in error. The results suggest caution in the use of cross-section relations to predict the course of fertility in developing countries.