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Economic and Demographic Aspects of the Reproductive Health Bill

Economic and Demographic Aspects of the Reproductive Health Bill

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Published by: CBCP for Life on Nov 05, 2012
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Economic and Demographic Aspects of the Reproductive Health Bill: A Question and Answer PrimeByDr. Roberto de Vera*8 September 2011
1. Is our population growing too fast?
Some persons point out that we need to manage the Philippine population because it issimply growing too fast for its own good (without clearly stating why). For if we don’t,they warn, that that the population will reach 178 million in 2036, double the 89 million in2007. We shouldn’t worry about this at all since this figure is way above the UN highvariant projection of 147 million for 2036 which can be found in the
UN’s onlinedatabase World Population Prospects: the 2010 Revision.
Why the wide difference? On one hand, the ‘population doubles’ projection assumesthat the 1995-2000 annual population growth rate of 2.36% will hold steady for the next29 years. On the other hand, the High Variant Projection of the UN 2010 Revision of theWorld Population Prospects assumes that these growth rates will come down from2.03% in 2000-2005 to 1.31% in 2045-2050. The latter assumption seems to be morereasonable since Philippine annual population growth rates have been decreasing: from3.06% in 1948-1960 down to 2.36% in 1995-2000. Based on the last census, it hasgone down even further to 2.04% in 2000-2007.What people don’t realize about increasing population is that it is caused by less babiesdying and more people living longer.
Peter Bauer 
has written: “Clearly, the much-deplored population explosion…should be seen as a blessing rather than a disaster,because it stems from a fall in mortality, a prima facie improvement in people’s welfare,not a deterioration.” For instance, infant mortality rates in the Philippines (i.e. thenumber of deaths per 1,000 births one year of age or younger) have gone down from96.8 in 1950-55 to 35.1 in 1994-1998 and further down to 24.9 in 2004-2008. Lifeexpectancies from birth have increased in the 1950-2002 period: from 54.1 to 66.9 for males and from 56.7 to 72.2 for females.
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2. Does a faster annual population growth rate mean a slower annual growth ratein income per person (or more commonly measured as per capita GrossDomestic Product (GDP))?
Several studies have shown that there is no clear link between population growth andeconomic growth. Nobel prize winner 
Simon Kuznets
’s pioneering study contained inhis 1966 book
Modern Economic Growth: Rate, Structure and Spread 
(pp. 67-68)showed that “[n]o clear association appears to exist in the present sample of countries,
* Assistant Professor, School of Economics, University of Asia and the Pacific, Pearl Drive,Ortigas Center, Pasig City, Philippines 1605 (roberto.devera@uap.asia)
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or is likely to exist in the other developed countries, between rates of growth of population and of product per capita.”Other studies have confirmed Kuznets’s findings in data for developed and developingcountries, showing no clear link between population growth and economic growth (or poverty).Here are the findings of five studies:(i) the 1992
Ross Levine and David Renelt study
of the relationship betweengrowth and its determinants found no significant effect of population growth oneconomic growth;(ii) the 1994
Jeff Kling and Lant Pritchett study
arrived at a similar findingwhere they allowed the effect of population growth on economic growth to varyaccording to the level of development and resource scarcity;(iii) in a 1996 review of the population growth-poverty relationship,
DennisAhlburg
points out that studies have showed population growth has little or nodirect effect on poverty;(iv) in a 2004 study examining the determinants of long term growth,
Xavier Sala-I-Martin, Gernot Doppelhofer and Ronald Miller 
found that averageannual population growth from 1960-1990 was not robustly correlated witheconomic growth;(v) the 2007
Eric Hanushek and Ludger Woessmann study
found thataverage annual population growth from 1960-1990 was not robustly correlatedwith economic growth;Similar conclusions have been arrived at by the US National Research Council in 1986and in the UN Population Fund (UNFPA) Consultative Meeting of Economists in 1992.Moreover, these studies support
Kuznets
’s explanation of why no direct relationshipcould be expected between population growth and economic growth. Population growthand economic growth are linked through “a common set of political and socialinstitutions.” Thus, any “direct causal relation” between them “may be quite limited.”Moreover, any relationship that is measured cannot be used as a basis for managingpopulation to affect economic growth.It important to note that even if there are recent econometric studies that show thatpopulation growth is negatively correlated with per capita income growth in thePhilippine case (i.e. an increase in the population growth rate leads to a decrease in per capita income growth rate), these studies cannot conclude that higher population growthrates causes lower per capita income growth rates. It is more probable that there areintervening factors such as those mentioned by Kuznets that may cause economic
 
growth. Thus, these studies cannot serve as bases for a policy that aims to reducepopulation growth to raise per capita income growth.
3. If population growth doesn’t affect economic growth, what will?
Good governance and well-implemented economic policies raises economic growthwhich is needed to reduce proverty.In 2008, a
Commission on Growth and Development led by Michael Spence
, aNobel Prize winner in Economics, identified five ingredients for sustaining rapid growthand inclusive development.These high growth economies:i) exploited the world economy;ii) kept macroeconomic stability;iii) achieved high rates of savings and investment;iv) let markets allocate resources; andv) had committed, credible and capable governments.Note that the study didn’t mention population management as one of the ingredients of sustaining high economic growth rates.In his book,
he Ultimate Resource
Julian Simon gives evidence for the crucial rolethat good governance and economic policies play in economic growth when hecompares three pairs of countries that have the same culture and history and practicallyhad the same standard before they split after World War II—East and West Germany,North and South Korea, and Taiwan and China. In 1950, both the communist and non-communist countries had practically the same birthrates and the centrally plannedeconomies had less population pressure than their market-directed counterparts asmeasured by population per square kilometer. Yet the economic growth of WestGermany, South Korea, and Taiwan was better than their counterpart centrally plannedeconomies. Due to faster economic growth, personal incomes in Taiwan and SouthKorea were roughly double China and North Korea, respectively while those in WestGermany’s was more than 10% larger than East Germany in the early 1980s.
Table 1. Population density, 1950 and real income per capita,1950, 1980, and 1982 for selected countries*
East GermanyWest GermanyPopulation density, 1950** 171 201Real gnp per capita, 1950***2,9432,943Real gnp per capita, 19829,914 11,032North KoreaSouth KoreaPopulation density, 1950 76 212Real gnp per capita, 1950 193 193Real gnp per capita, 1982 8171,611ChinaTaiwan
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