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  1. 1
    054254
    Peer Reviewed

    A reformulation of the economic theory of fertility.

    Becker GS; Barro RJ

    QUARTERLY JOURNAL OF ECONOMICS. 1988 Feb; 103(1):1-25.

    An economic analysis of the linkages in fertility rates and capital accumulation across generations is developed, considering the determination of fertility and capital accumulation in each generation when wage rates and interest rates are parameters to each family and to open economies. The model is based on the assumption that parents are altruistic toward their children. The utility of parents depends on their own consumption and on the utility of each child and the number of children. By relating the utility of children to their own consumption and to the utility of their children, a dynastic utility function was obtained that depends on the consumption and number of descendants in all generations. The term "reformulation" was used because of the emphasis on dynastic utility model of altruism toward children and deriving the budget constraint and utility function of a dynastic family, the model was applied to the Great Depression and World War II. The 1st-order conditions to maximize utility imply that fertility in any generation depends positively on the real interest rate and the degree of altruism and negatively on the rate of growth in per capita consumption from 1 generation to the next. Consumption of each descendant depends positively on the net cost of rearing a desdendant. Applying the model, it is shown that the analysis is consistent with baby busts during the Depression and the war and with a baby boom after the war. The effects on fertility of child mortality, subsidies to (or taxes on) children, and social security and other transfer payments to adults were considered. The demand for surviving children rises during the transition to low child mortality, but demand for survivors return to its prior level once mortality stabilizes at a low level. Fertility falls in response to declines in international real interest rates and increases in an economy's rate of technological progress. Extending the analysis to include life-cycle variations in consumption, earnings, and utility, fertility emerges as a function of expenditures on the subsistence and human capital of children but not of expenditures that simply raise the consumption of children. The path of aggregate consumption in demographic steady states does not depend on interest rates, time preference, or other determinants of life-cycle variations in consumption.
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  2. 2
    035874

    [Using demographic statistics in market studies and specifically for the business planning] Utilisation des statistiques demographiques dans les etudes de marche et specifiquement pour les plans des entreprises.

    Dackam Ngatchou R; Lamlenn BS

    In: Utilisation des statistiques demographiques au Cameroun. Actes d'une Seminaire tenu du 16 au 19 Juillet 1984 a Yaounde. Yaounde, Cameroon, Ministere du Plan et de l'Amenagement du Territoire, 1985 Jul. 308-32.

    This article assesses the potential use of demographic statistics in determining the volume and structure of consumption through market studies and the sources of demographic data used in market studies, and presents concrete examples of demographic data use in market studies in Cameroon. The age and sex structure of the population influences the availability of labor and the extent of the market for particular products, while the socioeconomic structure is related to income and purchasing power. Population movements of particular interest to business planning include rural-urban migration, change in the numbers of households or household size, and change in household budgets. Population growth, determined by prevailing patterns of fertility, mortality, and migration, is the most important determinant of total consumption of many products. The 3 major data sources for market studies are population censuses, demographic surveys, and civil registration systems. Censuses furnish exhaustive statistics on individual and collective characteristics for population units of all sizes, serve as bases for sampling studies, and are useful for study of population movement. Budget-consumption studies with demographic content are the usual method of determining effective consumption. The budget-consumption survey underway in Cameroon is expected to yield data on a wide range of household expenditures. A well-functioning civil registration system combined with accurate knowledge of migratory trends would permit calculation of the population growth rate. Concrete examples of market studies undertaken in Cameroon using available demographic data include a footwear manufacturer that used demographic data to help estimate the proportion of shoes to offer for different ages and sizes of feet, a producer of school notebooks who used data on population structure to determine the number of each type of notebook to produce, and a life insurance company which needed to structure rates to fit Cameroon, a country with few actuaries. A cigarette company and a brewery requiring data for planning of distribution and possible expansion are other examples of enterprises requiring demographic data. Limited availability of official statistics and out-of-date data forced each company to some extent to develop supplementary data collection systems.
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  3. 3
    033689

    [Third World cities: points of accumulation, centers of distribution] Les villes du Tiers Monde: theatres d'accumulation, centres de diffusion.

    Armstrong WR; McGee TG

    Tiers-Monde. 1985 Oct-Dec; 26(104):823-40.

    Attention was called over 3 decades ago to the very rapid growth of Third World cities and the significance of the differences between their patterns of urbanization and those of industrialized countries. Their demographic growth occurred much faster and depended much more heavily on high fertility, their economies were geared more to export of raw materials than to manufacturing and were unable to create massive numbers of jobs to absorb the growing labor force except in the unproductive tertiary sector, and it appeared unlikely that they would be able to produce entrepreneurial classes of their own. Several economic developments during the 1970s affected the world economy and the patterns of urbanization of the Third World: the decline of the principal capitalist economies and the multiple increases in the price of oil, the floating exchange rate, the considerable increase in consumer goods, and the increasing costs of labor in industrialized countries, among others, created new conditions. World economic interdependence, international control of investment and exchange, and volume and mobility of capital increased at a time of rapid economic growth in some Third World countries, especially those whose governments took an aggressive role in promoting growth and investment. Some Third World cities now seem to be developing according to a more western model, but the same cannot be said of all Third World countries, and international economic evolution appears to have led to increasing polarization between countries as well as within them. The 1 domain where a certain convergence has occurred is consumption, beginning with the privileged classes and filtering to the lower income groups. Consumption of collective and individual consumer goods, which is concentrated in the largest cities, increases dependence on imports, technology, knowledge, and usually debt. The modern productive sector and its distribution activities become implanted in the cities to such a degree that it becomes more and more difficult for the consumption needs of regional cities and rural areas to be satisfied except through manufactured products from the capitalist sector of the principal city or through imports from industrial countries. Despite the fact that some Third World cities will be enormous by the year 2000 and that their social structures and labor forces will not closely resemble those of European cities, the thesis of "pseudourbanization" appears invalid for several reasons: the model of sectorial changes in the European labor force was not followed by the industrializing countries of North America; some Third World countries (excluding India and China) appear able to absorb most of their surplus rural population into the modern sector, and Third World cities appear less and less to be merely centers of culture. New research during the 1970s on Third World urbanization contributed several crucial elements to the analysis: recognition that insertion of developing countries into the international economic order has been a major influence on their urbanization patterns, appreciation of the role of migration in urbanization, realization of the potential role of the state in mitigating spatial and structural inequalities created by the urbanization process, and recognition of the need for more detailed microeconomic studies and construction of more elaborate models of Third World economies.
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  4. 4
    030970

    The demand for primary health care services in the Bicol region of the Philippines.

    Akin JS; Griffin CC; Guilkey DK; Popkin BM

    [Unpublished] 1985. Presented at the Annual Meeting of the Population Association of America, Boston, Massachusetts, March 28-30, 1985. Also published in: Economic Development and Cultural Change 34(4):755-82. 1986 Jul. 26, [21] p.

    Mortality is assumed to be strongly reduced by medical care, however, the effects of medical services on health are often underestimated because some of the same factors which lead to an increased demand for primary health care (PHC) services are also associated with increased morbidity and mortality. Consequently, understanding the determinants of the demand for medical services is important for evaluating health outcomes. This paper estimates the parameters of a simple model of the demand for health services using data from the Bicol Multipurpose Survey data from the Philippines. The parameters of the demand for key components of PHC--outpatient, prenatal, delivery, well-child, and infant immunizations--are estimated. Findings suggest that the quality of the care may be very important, but that economic factors as deterrents to using medical care--inaccessibility, cash costs, and lack of income--may not be of paramount importance. Finally, it is shown that the provision of free services in rural areas may not insure that the services reach the poorest people. (author's modified)
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  5. 5
    031055

    National saving rates and population growth: a new model and new evidence.

    Mason A

    [Unpublished] 1985 Mar. 55 p.

    This study presents new analysis and evidence on the link between population growth and national saving. Analysis was based on the variable rate-of-growth effect model (Mason, 1981; Fry and Mason, 1982), which distinguishes 2 population growth effects: the rate of growth effect and the dependency effect. The paper's 1st section reviews previous research on the saving population growth link, including applications of the variable rate-of-growth effect model. Its 2nd part presents an extension of the variable rate-of-growth effect model by linking factors determining the number of children reared to the budget shares devoted to childbearing and, in turn, to the national saving rate. Part 3 presents estimates from international cross-section data covering the 1960-80 period. The final section uses the neoclassical growth model to show circumstances under which the rate of growth effect dominates the dependency effect reversing the relationship between population growth and saving. Available evidence from the international cross-section supports the proposition that a higher dependency ratio leads to lower saving, particularly among countries with moderate to high rates of income growth. At the mean rate of growth observed over the last 2 decades for the 70 countries analyzed, a decline from a high to a low childbearing regime generated an increase in the net national saving rate of about 5% -- nearly a 50% increase. The results reported also addressed the magnitude and validity of the equivalent adult consumer unit. Aggregate consumption data imply an equivalent adult consumer unit of about 1/3. The analysis implies that simulation models that are based on equivalent adult consumer unit can provide useful insights about the relationship between population growth and aggregate consumption and saving rates. The analysis fails to fully resolve the issue of the relative importance of the rate of growth and dependency effects. It is based on the neoclassical growth model for which the equilibrium rate of growth of national income increases point for point with an increase in the rate of growth of population. Given the long periods required to adjust from one equilibrium to another, the steady-state results of the neoclassical model may have limited relevance to the design and evaluation of development and population policy. Although the model proposed clearly delineates the link between children, household saving, and national saving, the role ascribed to children is limited. Only that children require household resources for their support is acknowledged.
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  6. 6
    030846

    National Institute on Aging macroeconomic-demographic model

    United States. National Institutes of Health [NIH]

    Bethesda, Md, United States. National Institutes of Health [NIH], 1984. x, 146 p.

    This monograph describes the initial version of the longterm macroeconomic demographic model of the US economy which was developed for the National Institute of Aging (NIA) to investigate the effects of demographic aging on the income level of the elderly as well as on productivity, consumption, savings, and investment. Important features of the model design included the use of large amounts of demographic information, explicit representation of the process of economic growth, the use of a general equilibrium framework, representation of the structural features of the major pension systems, and a comprehensive, integrated approach. The macroeconomic demographic model is composed of a core macroeconomic and demographic modelling system and 5 peripheral models that depict the operation and behavior of the major components of the retirement income system. The core model has 3 major parts: a population projection system, a macroeconmic growth model, and a labor market model. The population model replicates US Census Bureau population projection methodology to project total US population by age and sex for each year from 1970 through 2055. The longterm econometric forecasting model which depicts formulation of working, spending, and savings plans by households and production, investment, and employment plans by businesses, as well as projecting demand for and supply of goods and services. The labor market model depicts the demand for labor, the supply of labor measured in total annual manhours worked for each of 22 age-sex groups, and the simultaneous determination of labor and capital services input along with compensation, output, and employment. The 5 major elements of the retirement income system that are modelled are the Social Security system, the private pension system, the public employee retirement system, the Supplemental Security Income system, and the Medicare system. At the start of each simulation year, the population model forecasts the new size and composition of the population. The macroeconomic growth model and labor market model use the figures to project levels of aggregate economic activity and labor market outputs for the 22 different age-sex cohorts. These projections are inputs into the simulation of each of the 3 pension system models and 2 transfer income models. 1 chapter of the report describes in nontechnical terms each of the 3 core and 5 peripheral models while the final chapter presents the base case simulation and validation of the model from 1970 to 1979. A series of appendices present the equations of each of the 5 principal models and also discuss new analyses completed in the course of model development.
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  7. 7
    030346

    The relationship between population policy and socio-economic development

    Wander H

    In: Population policies in Asian countries: contemporary targets, measures and effects, edited by Hermann Schubnell. Lubeck, Germany, Federal Republic of, Drager Foundation, 1984. 429-43. (Centre of Asian Studies Occasional Papers and Monographs no. 57)

    Population policy conforming to socioeconomic development needs to be broadly defined and organized. This term is used as a collective notion for all sorts of political action designed to influence population trends according to specific objectives. The objectives, which are usually expressed in terms of demographic numbers or rates and related to a fixed period, need to meet 2 main requirements: they must comply with anticipated socioeconomic change on the macro-level as well as with needs and interests on the micro-level. When designing population policies, both levels must be considered, the one for determining desirable objectives and the other for choosing suitable strategies to realize the objectives. The discussion first examines the impact of population growth on the macro-level and then draws conclusions for appropriate policies. All developing countries are working for quick modernization and all want to raise productivity, to overcome economic dualism, and to promote sectoral and regional integration. Considering these common goals, the discussion turns to the question of how population trends at the various stages of transition correspond with the need to speed up socioeconomic progress. Leaving migration aside, the salient demographic factors to be considered are fertility and mortality. All economic problems caused by population growth arise from the respective conditions of births and deaths. These conditions are also the targets of population policy. A fall in mortality is a prerequisite for socioeconomic change. Mortality decline should be promoted despite the fact that the population will then grow more quickly. The problems which plague most developing countries with rapid population growth such as severe underemployment, unemployment and excessive urbanization are supported by persistent high fertility, but not by falling mortality. Only if fertility decreases will the other important d emographic obstacle to economic progress, i.e., the high dependency burden, become smaller. To show the basic effects of various fertility and mortality levels on such economically relevant facts as length of working life, youth dependency, and costs of raising the young generation, 3 models are used which correspond to 3 stages of demographic transition -- ongoing transition, advanced transition, and late transitional stage. The exercise shows that birth decline tends to improve consumption standards and in this way to influence economic development before the labor force is directly affected. Almost all developing countries need population policies to set in motion and speed up a fall in birth of either total population or certain population groups. Communal self help activities are particularly useful as part of programs aimed at inducing and speeding up fertility declines. Measures in the field of family planning, which are now the core of the programs, will be accepted more readily if families regard them as a means of improving social well-being.
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  8. 8
    023672

    The adjustment of migrants in large cities of less developed countries: some comparative observations.

    Goldscheider C

    In: Goldscheider C, ed. Urban migrants in developing nations: patterns and problems of adjustment. Boulder, Colorado, Westview Press, 1983. 233-53.

    Results of 4 case studies of Indonesia, South Korea, Iran, and Colombia may be compared along 3 broad dimensions of migrant adjustment to urban places: labor force, including employment and occupational patterns; housing, consumption, and income; and social and psychological elements of adjustment. Occupational changes and the economic mobility of migrants have important consequences for other forms of urban modern adjustments. Better jobs, higher incomes, quality housing, and increased consumer consumption are directly linked. These, in turn, are connected to social and social-psychological adjustments as well as to educational increases for the children of migrants. Occupational changes thus become the pivot around which migration and modernization revolve. Whatever the specific pattern, the relationships between migration and occupation are intertwined in complex ways with the economic development and social modernization of less developed countries. Comparative findings on occupational prestige lead to 3 conclusions: migrants are not particularly disadvantaged in terms of job prestige relative to comparable lifetime urban residents; occupational differences between migrants and natives reflect the background disadvantages of migrants, rather than the impact of migration per se; and over time, migrants attain the occupational levels that are consistent with their skills, education, and experience. These findings, almost without exception, emerge from all 4 case studies. In Korea and Iran, some elements of urban housing and neighborhoods quality are unrelated to migrant status. In Seoul, migrants and natives live in the same quality neighborhoods, consistent with their income and educational levels. Neither recency of migration nor migrant status was specifically associated with neighborhood quality. Parallel findings were reported for migrants to Tehran. 2 other measures of housing showed significant differences between migrants and lifetime urban residents: number of rooms per person and home ownership. Clearly migration status has a significant effect on some aspects of housing quality in Seoul and Tehran. Migrants to Surabaya are no worse off in terms of housing than those born in city. All migrants seem to improve their housing over time, yet 2 subgroups of migrants are particularly disadvantaged: migrants of farm background and the low income self employed. Regarding personal adjustment, defined in terms of traditionalism and satisfaction indexes, the case studies for Korea, Indonesia, and Colombia show little variation among migrant groups or between migrants and lifetime urban residents. The comparative examination of these studies suggests several interrelated, yet independent, dimensions of adjustment. Migrants adjust in some ways and not in other, while some migrants adjust better than others. Adjustment varies with the social, economic, political, and cultural context of urban places and changes over time. The overwhelming impression gained from these studies is that migration is positive for the migrants.
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  9. 9
    267409

    [Bolivia: framework for population policy] Bolivia: marco referencial sobre politicas de poblacion.

    Carafa CR

    In: Luz y sombra de la vida: mortalidad y fecundidad en Bolivia [Light and dark of life: mortality and fertility in Bolivia], by Carlos Carafa, Gerardo Gonzalez, Valeria Ramirez, Rene Pereira, and Hugo Torrez La Paz, Bolivia, Proyecto Politicas de Poblacion, 1983. 1-42.

    Bolivia's population policy must be framed within 3 contexts: an economic and family structure which conditions production and reproduction; as part of Latin America, which is characterized by dependent development, structural heterogeneity, and social differentiation; and as a particlar socioeconomic structure with specific population dynamics. As a peripheral country subordinate to the developed capitalist nations, Bolivia has undergone a process of social differentiation. Mining, which has shaped the economy and society, is declining. Agriculture dominates in terms of jobs, but peasant farms cannot compete with agribusiness. A weak manufacturing sector and increasing urbanization have created vast underemployment and a swollen tertiary sector. Urban-rural disparities have widened. Only 2% of all rural health care needs are met; water and sewerage services are similarly deficient. As the main investor and largest employer, the government can guide development, but its policies have favored agroindustrial interests at the expense of the small farmer. These realities suggest the following working hypotheses: 1) the size, structure and growth of the population determines both the supply of labor and the demand for goods and services. 2) Bolivia's unbalanced occupational structure heightens class differences and disparities in life chances; reproductive patterns reflect the population's social and material circumstances. 3) Outmigration is the peasantry's response to the crisis of the rural areas; migratory movement follow economic activity. 4) Mortality and fertility differentials reflect socioeconomic and cultural differences; rural families see children as assets; 5) The costs fo bearing and raising children do not affect reproductive decisions among the peasantry. 6) Early marriages, low use of contraceptives, low education all interact to raise the fertility of peasant women; these factors are weaker among salaried workers. 7) Urbanization unleashes a number of changes which depress fertility; traditional values are eclipsed by the costs of childbearing. 8) Mortality risks are higher in the rural areas and affect all subgrups; urban areas exhibit greater variation. 9) Disparities in death and fertility rates suggest that different subgroups are at different stages of the demographic transition. Bolivia as a whole is in the 1st stage of this process.
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  10. 10
    032537

    [Causal hypotheses on fertility: the preponderant role of the family unit] Hipotesis causales sobre fecundidad: el papel preponderante de la unidad familiar.

    Aguinaga Roustan J

    Revista Espanola de Investigaciones Sociologicas. 1983 Jan-Mar; (21):83-101.

    This article reviews fertility theories proposed by economists, sociologists, and demographers over the past few decades and assesses their suitability to the Spanish case. In the early 1960s the foundations for the so-called new home economics were laid by Becker and others of the Chicago school of microeconomics. Becker held that once contraception became available to all population groups, childbearing decisions would be made in the same way as those for any other consumer good. Becker concluded that income is a direct function of the number of children and their quality. In 1962 Friedmann, within the same model, argued that children like automobiles or any other good-were associated with benefits as well as costs. Judith Blake in 1968 criticized both positions, pointing out that the rich have not had more children in any developed society and that the acquisition of children is not under the same cost constraints as that of other goods. Modifications of the theory by Becker gave greater importance to sociological variables. Leibenstein proposed an explanatory model which related fertility change to economic development through an examination of costs and benefits at different stages. Easterlin used the theory of Kuznets cycles to argue that the size of a cohort is related negatively to its fertility, with the fundamental variable being the labor market. He later proposed a more elaborate model that synthesized economic and sociological arguments and introduced new variables with emphasis on endogenous preferences and ferility. Use of sociological concepts such as "tastes", "desires", and "behavior", and of the term "relative" to suggest subjective perceptions depending on cultural context has become common in economic theories of fertility. The only fertility model elaborated in demography is that of the demographic transition, which has been criticized for being more descriptive than explanatory. In sociology a series of variables have been related to fertility, with only partial success. Some of the hypotheses were studied by means of large surveys, a program culmintting in the World Fertility Survey. Fertility differentials by income and rural or urban residence have been the only 2 generalizable findings to date. Finally, the analytical model of Davis and Blake listed the intermediate variables through which social factors were related to fertility. Sociological explanations are increasing in importance for nonsociologists, especially economists and demographers, and family structure in particular has assumed strategic importance. A scarcity of empirical work on fertility in Spain has hampered testing of fertility theories there. Hypotheses bearing on the determinants of fertility decisions should be tested in Spain, with preconscious-factors such as imitation, pressure exerted by the family and social circle, and affective relations as well as structural factors examined.
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