Population Growth and Economic Development: Causes, Consequences, and Controversies Lecture 7 1.
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1 Population Growth and Economic Development: Causes, Consequences, and Controversies Lecture 71
2 The Basic Issue: Is Population Growth Good or Bad? Argument:Population is a serious problem in developing countries?Theories:Demographic transitionMalthusian modelMicroeconomic theory of fertilityFacts:Some empirical evidencesPolicies:What can developing countries do?There are six major issues concerning population growth and quality of life.
3 1.1 Population Growth Is A Problem! Population and the Global CrisisPoverty, low levels of living, malnutrition, ill health, environmental degradation, etc.Population-poverty cyclesPopulation growth, saving, per capital income growth7 NegativesLower Y per headPoor people bear burden of population growthLarge population limits educational opportunitiesHealth of women is harmedFamily food is limitedEnvironmental degradation occursIllegal international migration and over urbanization
4 1.2 Population Growth Isn’t A Problem! Other IssuesUnderdevelopmentResource Depletion and Environmental DestructionPopulation DistributionSubordination of WomenFalse IssueNeocolonial dependence theoryDesirableConsumer DemandEconomies of ScaleLabor Supply (sufficient-low cost)Non-economic reasons
5 2.1 The Demographic Transition Stage I: high birthrates and death ratesStage II: continued high birthrates, declining death ratesStage III: falling birthrates and death rates, eventually stabilizing
10 2.3 The Household ModelThe microeconomic household theory of fertility
11 Demand for Children Equation WhereCd is the demand for surviving childrenY is the level of household incomePc is the “net” price of childrenPx is price of all other goodstx is the tastes for goods relative to children
12 Demand for Children Equation Under neoclassical conditions, we would expect:
30 4. Some Policy Approaches What developing countries can do:Long run: increase the price of childopportunity cost of mother’s timeCost of educating childShort run: control fertilityPersuade peopleFamily-planning programsEconomic incentives and disincentivesRedistribute populationCoerce peopleRaise women’s social and economic status