DEMOGRAPHIC DIVIDEND IN BRAZIL: AN ANALYSIS OF AGE STRUCTURE AND DEVELOPMENT

ERNESTO F. AMARAL

POPULATION RESEARCH CENTER

THE UNIVERSITY OF TEXAS AT AUSTIN

DEMOGRAPHIC DIVIDEND

Falling birth rate results in a smaller

proportion of population at younger ages

and in a higher proportion at adult ages.

It creates a good environment for a society in

terms of economic development.

FORMS OF ACTION

The consequences of the fertility decline on

the age structure can justify the family

planning in an imposing approach.

On the other hand, the demographic dividend

can be seen as a logical potentiality for the

country development.

POSSIBLE BENEFITS

The benefits of the dividend are not only

determined by the demographic conditions

of a society.

Instead, these benefits will occur only with

specific economic conditions, state

institutions, and family arrangements.

BRAZIL

Fertility declined from 6.3 in 1960 to 2.3

children per woman in 2000.

The demographic dividend should not be

used as a framework to implement strict

planning policies.

Government has to consider the dividend as

a population component.

1960-2000 Censuses microdata are analyzed.

10 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 10

10 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 10

10 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 1010 5 0 5 10

AGE STRUCTURE IN BRAZIL 1970

2000 1991

1980

Women Men

Source: Brazilian Census Bureau (IBGE).

Percent

POPULATION IN LABOR AGES

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

1980

1985

1990

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

2045

2050

Percent

15-24 years

Source: Oliveira (2004).

25-44 years

45-64 years

15-64 years

DIVIDEND IS ALREADY HELPING

One might think that the economic recession

in the 1990s reduced the demographic

dividend in Brazil.

However, municipal-level data shows that

earnings stagnation would be much more

dramatic without the demographic dividend.

EARNINGS PER CAPITA

The proportion of the total population in

labor ages had a positive impact on the

growth of earnings per capita in the 1990s.

This process happened in the municipal

level, even with the increase of informal

economy and unemployment rates.

GROWTH OF MUNICIPAL

EARNINGS PER CAPITA, 1991-2000

GRÁFICO 7:

GRÁFICO 8:

Crescimento da Renda Per Capita Municipal 1991-2000

-0,04

-0,02

0

0,02

0,04

0,06

0,08

0,1

0,12

3,5022 3,7315 3,87 4,1594 4,67 5,0979 5,3995 5,5772 5,8473

LN da Renda Per Capita Municipal em 1991

Taxa d

e c

rescim

en

to

Crescimento Renda PerCapita

Crescimento da Renda Per Capita Municipal 1991-2000

-0,02

-0,01

0

0,01

0,02

0,03

0,04

0,05

0,06

0,07

0,08

-0,771 -0,712 -0,686 -0,634 -0,538 -0,475 -0,447 -0,431 -0,406

LN da Razão PIA/POP Municipal em 1991

Taxa d

e c

rescim

en

to

Crescimento Renda PerCapita

Municipal

earnings

per capita

growth

rate

Ratio of population in labor ages

by total population in 1991 (logarithm)

Source: Rios-Neto (2005).

EDUCATION IMPROVEMENT

The decline in the proportion of population at

younger ages was crucial to the success of

the expansion of schooling attainment

implemented by government policies.

The rise in mother's education increased the

demand for school enrollment.

However, low-income families have smaller

demand for children education attainment.

IMPLICATIONS

Findings suggest that the demographic dividend

has an important role in the growth of municipal

earnings per capita.

Because of Brazilian inequality, universal public

policies do not seem to be the best option, such

as observed in the education findings.

One example of focalized policy is the one

transferring earnings to low-income families that

keep their children in school (Bolsa Família).

RECOMMENDATIONS

The demographic dividend has to be taken into

account to generate new policies or improve

existing ones.

Policies should focus on the transfers of

earnings to the low-income and less-educated

population groups.

The National Population Council should take a

lead to include the population analysis in the

agenda of other ministries.

SUMMARY

The most important challenge for the Brazilian

society is to generate employment for the people

entering the labor force, as well as to improve their

educational skills.

The Brazilian government has to implement new

policies in order to face the new national

demographic characteristics.

If government policies and civil society do not act in

the next years, the aging population will become a

social problem.