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ECON 3510
African
Economic
Development
See Text, Chapter 6
and class notes.
Demography and
Development
May 13, 2014
I. Theories of Population in the African Context
1. Malthus Theory and Demographic History
2. The Demographic Transformation
3. Microeconomic Theory of Population
II. African Demographic Experience
III. Note on Demographic Structures
IV. Implications of Rapid Population Growth for
African Economic Development
V. Population Policies
Agenda
1. Malthus Theory of Population Growth:
- people had an uncontrollable urge to procreate!
[This would not diminish as civilization progressed.]
- population growth would continue at a rapid pace (“geometrically”)
- Agriculture was subject to limited land and
diminishing returns. (“arithmetic”)
- population would expand to the point where
the “positive checks” would operate.
Famine, Disease and War.
Result: incomes would fall to the
starvation level.
Life would be “solitary, poor, nasty, brutish, and
short” for the vast majority of human beings.
(quoting Thomas Hobbes out of context.)
Is this or was this in fact the case?
An Economic History of the World! (courtesy of G. Clark, A Farewell to Alms)
Real Wage Levels, Europe, (G. Clark)
Real Output per Worker in England, 1260-1960. (G.Clark)
Was there any escape from this fate?
Was there any escape from this fate?
Malthus’ Recommendation:
Establish “Preventative Checks” on
population:
- “Moral Restraint,”
- Delay of marriage
How probable were these ?
Was Malthus’ Vision Correct?
In general maybe “No”
• at least for recent centuries
• though some parts of the world maybe
caught in a
“Malthusian Population Trap.”
Why or Why Not?
Malthus’ predictions: unfulfilled for high & medium income countries:
1. Technology of contraception was unforeseen;
2. Family Planning;
3. Technological change has postponed the impacts of serious diminishing returns; agricultural output has in fact grown more rapidly than population.
Why?
4. Has the “urge to procreate” declined?
5. Social and sociological impacts of
“Modernization” and Urbanization on birth rates were unforeseen:
- Higher female labour force participation;
- Higher status for women: increases education and reduces child-bearing
- Higher costs of raising children in modern urban areas vis-à-vis agriculture and rural areas
- Cultural factors: more Television etc. etc.
- Less need for children as family labour and old
age security;
Proximate causes: later marriage; contraception; abortion
Can Rapid Population Growth be Positive?
Esther Boserup: Yes
Population growth greater population
density innovation & productivity;
economies of scale
better support for infrastructure
Simon:
Short term results likely negative
Long term results, may be positive
Was Malthus’ Vision Correct for
“Africa”?
Are (some of) the Countries of Africa
Approaching a Malthusian Trap?
Why or Why Not?
Some Comparative Demographic Information
Country Size (square
kms.)
Popula
tion (Millions,
2005)
Population
Density (persons per
square km.,
2001)
Population
Growth
Rate (per cent)
Fertility
Rate (Children
per
Woman)
Burundi
Rwanda
Malawi
28,000
26,000
118,000
7.9
9.2
13.2
282
354
112
2.2
2.0
2.2
6.8
5.7
6.1
Nova Scotia
New
Brunswick
55,000
73,000
0.913
0.730
17
10
II. Theory of the Demographic Transition
(See Charts below)
Stage 1: High Birth Rate and Death rate
Population stability
Stage 2: Falling death Rate; Continuing High Birth Rate: Population increasing faster and faster;
Stage 3: Death Rate Decline Intensifies; Birth Rate Decline accelerates;
Population Growth continues but decelerates
Stage 4: Low Death Rate and Low Birth Date:
Population Stability To which I would add
Stage 5: The Current Reality for High Income Countries?
Death Rates Continue at a low level; Birth Rates fall further
Population Size Declines
www.ldeo.columbia.edu/edu/dees/V1003/imagres/demographic .transition2
Stage
5 Where are the Countries Africa in this Transition?
Where are the Countries Africa in this Transition?
Probably in both
Phase 2, where death rates (DR)
decline while birth rates (BR) remain
high, so that population growth
actually accelerates and in
Phase 3 where birth rates decline
while death rates are low, so that
population growth slows
decelerates.
Mauritius is an outlier and is
approaching or almost in phase 4 [with FR of 1.4 children per woman; BR of
10.6 live births per 1000 p.a.and DR of 7.3.
per 1000 p.a.and Population growth rate of
0.3% p.a.]
Explaining the Demographic Transition
Factors Affecting Death Rates:
Factors Affecting Birth Rates:
Usefulness of Approach
III. The Microeconomic Theory of Fertility
Application of basic microeconomic theory to the child-bearing decision.
Assumption: children are at least in part a good like others,
• providing “consumption” benefits to the parents and
• serving also as an investment good (providing labour and generating family
income)
III. The Microeconomic Theory of Fertility
Possible economic benefits of additional
children: Old-age security
Expected income from child labour
Costs of additional children:
Opportunity cost of Mothers’ time
Opportunity and actual costs of educating, & looking after children
How to reduce fertility rates?
Change the costs and the benefits! How?
Some Demographic Indicators, Africa
Total Fertility
Rate 1990-1995 2010-2015
Population
Growth Rate 2000-05 2010-15;
Working Age
Population (15-64)
Africa 6.1 3.6 2.5 2.5 56.4
Ethiopia 7.0 4.8 2.5 2.1 53.2
Kenya 5.6 4.5 2.6 2.7 50.7
Liberia 6.4 4.7 2.2 2.6 50.7
Mauritius 2.3 1.9 1.0 0.3 69.7
Somalia 6.5 6.2 2.4 2.6 53.1
Niger 7.5 7.9 3.5 3.5 49.1
Zambia 5.0 4.2 2.3 1.9 56.4
Source: UNDP HDR 2013
Liberia: Basic Demographic Indicators
1990 2011
Population (million) 2.2 4.1
Population Growth Rates(%) -2.2% +2.6%
Fertility Rates(births per woman)
Urban Population (%)
6.4
40.9
4.7
47.8
Dependency Ratios Children and seniors as % of adults, 15-25
92.7 83.9
Median Age 17.5 18.5
Why do African Fertility Rates Remain
High?
Fertility
Rates in
Africa, 2011
Source: The
Economist,
March 8. 2014
Why do Fertility Rates Remain High in
Many African Countries?
• Children as family labour force;
• Children as old age security
• Rural character of society
• Intergenerational wealth transfers
• Impacts of urbanization
• Access to electricity and consumer stuff
• Education for women: age of marriage
and opportunity costs of having children
• Presence of contraception and abortion
• Religion?
IV. A Note on Demographic Structures:
See: http://www.census.gov/population/international/data/idb/informationGateway.php
African Countries: e.g. Liberia
Kenya
Rwanda
Others China
Japan
Canada
USA
The Chinese Case:
Explain the “Demographic Window of Opportunity”
• Note the prospective “Aging Population” phenomenon and reductions in the
relative size of the “working age population” and the labour force
V. Implications of Rapid Population Growth for African Economic Development
What are they?
Is it a problem? Why?
V. Implications of Rapid Population Growth for African Economic Development
1. Impact on Income per Capita: When population is growing rapidly, economic growth
must grow exceed Population Growth Rates to maintain income per capita.
i.e. income per capita = income/population
2. Effects on Savings Rapid population growth tends to increase family and
national consumption, thereby reducing savings
3. Investment Rapid population growth requires that large amounts of
resources must be devoted to investments, to keep up with population growth.
4. “Dependency” ratios: Rapid population growth leads to “bottom heavy”
population pyramids, which
means the working age
population of a country
is relatively small as
a % of total
population., or a high
dependency ratio
Liberia:
Working Age Population: 50.7%
5. Effects on Employment and Unemployment:
Ever-growing cohorts of young people are entering the job market, adding to labour supply.
Can the demand for labour demand keep up?.
6. Impacts on Income Distribution:
Because family size is highest among the poor, rapid population growth affects income distribution negatively.
– The numerous children of the poor have less monetary, family or parental investment in their up-bringing
– They start off in life with minimal inheritances.
7. Environmental Impacts
Population growth in many places results in poor rural people being pushed into ever more marginal and environmentally-inappropriate farm lands.
Urban environmental strtesses with rapid urbanization
8. Rapid Urbanization
Urbanization in Africa: Some Indicators
Country
Urban
Population,
millions
1990 2007
Urban
Population %
of Total
1990 2012
Rate of
Urbanization
% per year,
1990-2007
Access to
Improved
Sanitation,
1990 2007
Ghana 5.7 11.2 36 52.6 4.2 11 15
Kenya 4.3 8.0 18 24.4 3.7 18 19
Mauritius 0.5 0.5 44 41.6 0.8 95 95
Nigeria 33.3 70.5 35 50.3 4.4 22 25
Somalia 2.0 3.1 30 38.2 2.7 na na
S. Africa 18.3 28.8 52 62.4 2.7 51
Tanzania 4.8 10.1 19 27.2 4.4 29 31
Sub-Saharan
Africa, Total
144.3 287.1 28 37.0 4.0 20 24
Source: World Bank, World Development Indicators, 2009 Table 3.11 and UNDP
HDR 2013
VI. Population Policies
Should governments pursue active population control policies ?
or
Should Governments wait for the “Demographic Transition” to occur automatically?
i.e. Does “Development” lead automatically
to Population Stability?
This has been controversial, for various reasons
Types of Programs:
1. Internal Migration?
A few countries have tried to relieve population pressures in some areas by migration to other under-populated areas (Amazonia in Brazil; the outer islands in Indonesia.)
Potential for Africa?.
2. International Migration?
The annual population increase in Africa (about 23 million) is too large to be relieved significantly via international migration.
Is this correct?
3. Constructing a policy environment promoting greater desire for smaller families
Governments can change the
environment in which families
decide to have children
- by designing programs and policies that
will induce parents to choose to have fewer
children and reduce family size.
Of special importance are 1. policies enhancing the status of women
2. promoting education in general and especially for girls
3. promoting breast-feeding,
4. reducing child labour
5. promoting higher labour force participation rates for women
6. improving social security and pensions (so fewer children are necessary to look after their aged parents)
Also:- promoting contraceptive use
- legalizing abortion?
4. Specific Family Planning Programs:
Coercive Approaches
China:
one child policy, with enforcement; rural exceptions, two in some cases
male child biases
India, Indira Gandhi:
Semi-coercive male sterilization (with reward of transistor radio)
Politically disastrous
India: Current Male child bias and selective abortion
4. Specific Family Planning Programs:
Promote Family Planning
• If families want large families in any case (for family labour purposes, for old-age security, etc.)
- they may not be interested in family planning facilities even if they are available.
• If families want smaller families due to the types of factors mentioned above:
- then making family planning facilities available can have an important impact.
- Integrate family planning with maternal and early child care?