The Causes of High Fertility in Developing Countries: The

Malthusian and Household Models (cont’d)

 The Microeconomic Theory of Fertility

Children are considered as a special kind of consumption good
so that fertility becomes a rational economic response to the
consumer’s demand for children relative to other goods.

If other factors are held constant, the desired number of

children can be expected to vary directly with household
income
  The Microeconomic Theory of Fertility

 birth is the outcome of decision making on the level of the

individual, along with their maximizational behavior;
 involvement of economic variables among the factors which
explain births.

Malthus suggested that fertility rises when incomes increase

and vice versa.

maximization – involves determining the change in total benefit and the change in total cost
associated with each unit of activity.
 The Demand for Children in Developing Countries

Economic theory of fertility assumes that the household

demand for children is determined by:
1. Family preferences for a certain number of surviving
children;
2. The price of “opportunity cost” of rearing these children;
and
3. Levels of family income
  The Demand for Children in Developing Countries

Psychological and Cultural determinant of family size in

developing countries:
First two or three children are “consumer goods”
Additional children are “investment goods”
Private Economic Benefits Private Costs
Expected income from child labor (e.g., Opportunity cost of the mother’s time
farm)
Eventual financial support for elderly Cost of educating children
parents
  The Demand for Children in Developing Countries

Son Preference, economic explanations:

1. daughters become primarily responsible for the husband’s
parents, rather that their biological parents;
2. sons are viewed as having higher lifetime earning potential,
and so may be more financially able to help;
3. dowry payments by the parents of the bride to the groom’s
family.
  The Demand for Children in Developing Countries

Some Empirical Evidence for the Economic Theory of

Fertility
•As women become better educated, they tend to earn a larger
share of household income and to produce fewer children.
•The importance of educating women and improving public
health and child nutrition programmes in reducing fertility
levels.
  Implications for Development and Fertility
SOCIAL AND ECONOMIC
PROGRESS
1. Increase in the education of women
2. Increase in female nonagricultural wage
employment opportunities
3. Increased direct employment and earnings of a
husband and wife or through the redistributions of
income and assets from rich to poor
4. Expanded public health programmes and better
nutritional status for both mother and child, and
better medical care
5. The development of old-age and other social
security systems outside the extended family
network
6. Expanded schooling opportunities
EFFECT THAT COULD LOWER
FERTILITY
Improvement in their role and status
Raises the price or cost of their traditional child-
rearing activities
Rise in family income levels
Reduction in infant mortality
Lessen the economic dependence of parents,
specially women, on their offspring
Parents can better substitute child “quality” for large
numbers of children
The Consequences of High Fertility:
Some Conflicting Perspectives


Population growth: “It’s Not a Real Problem”
The real problem is not population growth but the following:
◦Underdevelopment
◦World Resource Depletion and Environmental Destruction.
◦Population Distribution
◦Subordination of Women

“Overpopulation is a Deliberately Contrived False Issue”

“Population Growth is a Desirable Phenomenon”
 The Consequences of High Fertility:
Some Conflicting Perspectives

“Population Growth is a Desirable Phenomenon”

Three noneconomic arguments:
1. To protect currently underpopulated border regions against the
expansionist intentions of neighboring nations.

2. There are many ethnic, racial, and religious groups in less-developed

countries whose attitudes favoring large family size have to be
protected for both moral and political reasons.

3. Military and political power are often seen as dependent on a large

and youthful population
 The Consequences of High Fertility:
Some Conflicting Perspectives

“Population Growth Is a Real Problem”

Extremist Argument: Population and Global Crisis
Theoretical Argument: Population-Poverty Cycles and the Need
for Family-Planning Programmes
Empirical Argument: Seven Negative Consequences of
Population Growth
1. Lower economic growth 5. Food constraints
2. Poverty and Inequality 6. Impact on the environment
3. Adverse impact on education 7. Frictions over international
4. Adverse impact on health migration
Empirical – verifiable by observation or experience rather than theory or pure logic
 Goals and Objectives: Toward a Consensus

 Deal with the underlying social and economic conditions

of underdevelopment

 Establish family-planning programmes providing both the

educational and the technological means

 Developed countries should help developing countries

achieve their lowered fertility and mortality objectives by:
 Goals and Objectives: Toward a Consensus

- Cut back on the unnecessary consumption of products

that depletes nonrenewable world resources;

- Making genuine commitments to eradicate poverty,

illiteracy, disease, and malnutrition in developing countries
as well as their own;

- Recognizing that development is the real issue, not

simply population control.
Some Policy Approaches

 What Developing Countries Can Do

 Persuade people to have smaller families;
 Enhance family-planning programmes;
 Manipulate economic incentives and disincentives for
having children (e.g., reduction of maternity leave and benefits);
 Coerce people into having smaller families through the
power of state legislation and penalties (morally repugnant and
politically unacceptable, but is also extremely difficult to administer); and
 Raise the social and economic status of women
Some Policy Approaches

 What the Developed Countries Can Do

 Simplify their own consumption demands and lifestyles
 Liberalize the legal conditions for the international
immigration of poor, unskilled workers and their families

 How Developed Countries Can Help Developing Countries

with Their Population Programmes
 Area of research into the technology of fertility control; and
 Financial assistance for family-planning programs, public
health, and national population policy research activities
Some Policy Approaches

 Policy for Still-Developing Countries Facing

Population Declines
 Allow migration
 Provide generous retraining of workers
 Move up the value chain
 Create conditions to attract foreign investment
 Consider implementing incentives for families to have
more children
Thank you!