Demographic Constraints

Economic Development effect on Population growth

The Theory of Demographic Transition
This theory explains why all nations have more or less passed through the
same three stages of population growth.
Stage 1: Before their economic modernisation, these countries had stable
and very slow population growth for centuries. The reason was combination of
high birth rate and high death rate which compensated each other.
Stage 2: With economic development and increase in income, public
health facilities improved and so the mortality rate decreased gradually and life
expectancy increased from less than 40 years to more than 60 years. However
birth rate remained constant as there was no decline in fertility rates and so
population of these countries increased rapidly.
Stage 3: Finally stage 3 was reached when the forces and influence of
modernisation and economic development caused fertility to decline and
eventually birth rate converged to lower death rate leaving little or no population
growth.
This is how economic growth can be used to explain the theory of
demographic transititon.

The Microeconomic Theory of Fertility

In deciding whether to have an additional child or not, the parent generally
do a cost-benefit analysis. The benefits include expected income from child
labour on the farm and their family support for elderly parents.
The cost include
1. Opportunity cost of mothers time, the income that she could have
earned if she was not at home caring for her children.
2. The cost of educating children, here the parents face a trade-of
between high quality-high cost educated children and low quality-low cost
uneducated children.
Studies have shown that birth rate among poor are likely to fall when
1. Increase in education of women and consequential change in their role
and status
2. Increase in female non-agricultural wage employment which
increases the opportunity cost of child bearing and rearing
3. Rise in family income in direct employment and earning of husband and
wife and or redistribution of income and asset from rich to poor
4. Reduction in infant mortality through expanded public health
programme and better nutritional health for both parents and child
5. Development of old age and social security system to bridge the
economic dependency of parents on their children.

In summary, education of mother, high earning job for both parents (especially
mother), public health (Infant mortality) and social security (old age) are the
ways in which goal of population reduction can be achieved in third world
countries.

Population growth effect on Economic Development

Broadly there are two ways by which population growth can afect the
economy.
1. The Saving Effect: Savings are reduced by population growth because of
so-called burden of dependency. Because of high fertility rates and
declining mortality rates in young and old age groups, the proportion of
population in non-working group increases relative to those in working age
group. Since all must consume, in the absence of increasing output per
worker, saving per head must fall. Even if productivity is increasing,
savings are much less than they would be with a smaller number of
dependents per worker.
2. The Investment effect: With increasing population, a share of investible
resources has to be directed for reproducing for additional people facilities,
duplication of social services which would be unnecessary if population
were not growing. In fact research have shown that there has been greater
growth of GNP with the less rate of population growth as investible
resources are used for investment purpose rather than production
purpose.
Although some economists doubt about saving and investment efect
saying that major part of the saving in poor countries come from small wealthy
class whose fertility is low and the cost of additional children is met out of
consumption rather than saving. The poor people whose fertility rate is high are
anyway not the one who contributes to saving. Similarly for contradicting
investment efect, these economists say that whenever population growth
requires increase in production, which in turn require investment, the rich class
(whose fertility is already low) releases the investible funds for use.

Indias Demographic Transition

At the start of the 20th century, India was in Stage 1 of demographic
transition with birth rate of 49.2 and death rate of 42.6. Its demographic
transition began to change in around 1920s and 1930s with reduction in average
death rate and India started entering stage 2. These decades saw a decline in
the frequency and scale of major famines and epidemic. As a result life
expectancy and population growth rate started to increase. In 1931, population
growth rate crossed the 1 per cent per annum line. At the time of independence,
Indias population was 345 million, life expectancy was 33 years and Total
Fertility Rate (TFR) was close to 6 births.
Immediately after independence, the Govt. of India (GoI) placed great
stress on improving the health of its people. As a result, death rate have declined
very fast and is now in single digit (7.0). By the 1960s and 1970s, India was fully
into stage 2 with gradually declining but still high birth rate and fast declining
and low death rate. The reduction in death rate resulted in significant rise in the

population growth rate which was above 2 per cent in 1950s, 1960s, 1970s and
1980s. It was only after 1991 when birth rate started declining at much faster
rate then death rate and India entered phase 3. The population growth rate
reduced due to decline in birth rate and is now 1.6 per cent.
Although the TFR (Total Fertility rate) for India as a whole is still above the
replacement level (around 2.1) fertility in India has fallen quite sharply in recent
decades, from around 6 in 1961 to 3 in 2001 and 2.4 in 2012.
Stage 1
Stage 3
1900-20
0.3-0.6

Stage 2
1930 1950 1960-80
2000 2012 2030 2050
1.1
1.3
2.0-2.2
1.9
1.7
<1

~0

The decline in population growth in India is relatively recent and is

expected to decline at more pace in near future, not only due to steadily falling
fertility rates but also because of ongoing changes in the age structure of the
population. Now India is well into its last phase of demographic transition
involving falling population growth and sustained progress towards population
stabilization which is expected to happen towards middle of this century.

Causes of High Birth Rate

The birth rate which measures the number of live births per thousand of
population, is only a crude measure and thus called Crude Birth Rate. It is crude
because it associates the total number of live births with total population,
whether young or old, male or female or whether they belong to reproductive
age group or not. At the start of 20th century, Birth Rate in India was around 50
which declined to 40.9 in 50 years (1951); during the same period, death rate
declined by 20 from 42.6 in 1901 to 22.8 in 1951. In 2012, birth rate is 21. 6
while death rate is at 7.0. There are multiple reasons of high birth rate in India,
some of them are listed here:

Social Cause
Social factors like universality of marriage and marriage at young age,
joint family system, preference for a son result in high birth rate.

Economic Factor
Economic factors such as widespread proverty, high infant mortality and
children as an insurance have also contributed as high birth rate.

Poverty
Among poverty groups not much money is spent on the upbringing of the
children and hence they are not much of a liability. Rather they start working at
an early easy by working at farms or at urban industrial areas and contributing to
family income. Hence they add to family income and prove an asset to the
family. Among poor families, additional children do not add to any burden, rather
they provide helping hands for the family.

Lack of Social Security

In the absence of social security like old age pension; children are used as
insurance by poor families. They expect their children to look after them in their
old age. Because of high infant mortality rates, people like to raise larger families
so that some of them survive to look after their parents in the old age. Thus,
absence of social security combines with high infant mortality rate contribute to
high birth rate.

Illiteracy, ignorance and Belief in faith

Because of illiteracy, people have become ignorant and thus accepts
every child as will of God and would never think of interfering with His will. This
increase the birth rate in India.

Inefficient family planning

Thus, high birth rate in India is a result of a whole lot of social, economic
and religious and cultural factors. So unless a change is brought about in our
attitude by spreading education and enlightenment or through economic and
political pressure, not much decline can be expected in prevailing high birth rate.

Fertility rate
Total Fertility Rate (TFR) measures the average number of children born to
a women upto the end of reproductive period. TFR, which was around 6 during
1951-52 declines to 2.4 in 2012.TFR depends on propoertion of married
population , age at marriage and the number of children born per married
women in the course of her reproductive cycle. It is expected by 2020, India will
reach the replacement level of fertility (TFR=2.1).

Cause of Decline in Death Rate

At the start of the 20th century, death rate was very high at 42.6 in 1901
which increased to 47.2 per thousand during 1911-1920. But since
independence, death rate has reduced very significantly from 22.8 in 1951 to 7
per thousand in 2012. This decline in death rate was slow and gradual during
earlier period but became progressively sharper after 1951. Some of the causes
of decline in death rate are:
1. Control of Epidemic: In the earlier year of 20th century, epidemics like
plaguy, smallpox, malaria etc. took a heavy tool of life. But with increasing
availability of efective medicines and improvement in health care
facilities, these epidemics have been controlled. This has contributed to a
substantial reduction in death rate.
2. Control of Famines: Famines which occurred in India frequently and with
marked regularity took a heavy toll of life. For example, the Bengal Famine
of 1943 caused thousands of starvation deaths while millions of people
fled to other parts of the country. With the improvement of means of
transport and communication, famines have been efectively checked.

3. Improved Medical Facilities: With the increased investment in health

and medical care facilities, new hospitals have come up and large number
of dispensaries have been opened in even far flung rural areas. Thus an
increasingly greater proportion of population is now being provided
medical facilities. This has improved health and preventive death due to
timely availability of medical aid.
4. Spread of Maternity Homes: With spread of maternity homes where
trained stafs looks after child birth, maternal mortality rate has largely
prevented.
5. Impact of Economic Development: Due to economic development,
income and living standard of people have risen, as a result their health
and nutritional level have improved and made them less prone to
diseases. Improvement in personal hygiene and sanitary condition which
go with better living standard has prevented the spread of communicable
diseases. Education has made them aware of preventive measures that
ensures disease free life. Special program aimed at improving income and
living standard of the poorer sections of the society, provision of basic
needs such as pure drinking water, health care facilities, house for the
homeless etc. have all contributed to better life and fewer deaths.

Measures to Reduce Birth Rates

1.
2.
3.
4.

5.
6.

Following methods can be used for reducing Birth Rates:

Spread of Education particularly female education as we have seen the
examples of Kerala and Tamilnadu
Increase in Female wage employment: A well earning women will
have higher opportunity cost of bearing and rearing children
Provision of old age pension and social security which will reduce
the dependency of parents on their children.
Reduction in infant mortality: Infant mortality reduced by public health
program and better nutritional standard by ensuring longevity of lie for
new born children will help in reducing birth rate.
Family Planning: Family planning by use of various birth control devices
by young couples and one or two children at proper interval.
Incentives for small families: Govt can provide incentives in jobs,
housing and other loans at low interest rate, preference in allotment of
accommodation to people with small families can have a great impact on
cutting down the birth rate. A scheme of disincentive to people with large
families can also be devised so that policy of carrot and stick can yield the
desired fall in population growth rate.

Concerns about Population Growth

The incidence of nutritional deprivation in India is among the highest in
the world. General undernourishment (sometimes called protein-energy
malnutrition) is nearly twice as high in India as compared to sub-Saharan Africa
on the average. The proportion of undernourished children in Africa is 20-40 per
cent while that in India is around 40-60 per cent. The proportion of severely
undernourished children in India is above 20 per cent in larger north India states
(based on the weight-for-age criterion).
Some of the major concerns related to population growth are:

1. Food Consumption per head: Due to increasing population and near

constant yield in agricultural productivity, the size and composition of food
consumption per head is decreasing.
2. Pressure on Environmental resources: This pressure is even serious
than even food production and consumption. We have sufficient evident of
rapid deterioration of local environment across the country and Indias
contribution in global environmental degradation. This may cause wide
range of adversities varying from overcrowding of habitat and increase in
man-made pollution to the denuding of forest and vegetation.
3. Pressure on Social Infrastructure: Rapid population may also cause
pressure on social infrastructure, including sewage system, hospital
facilities, railway network, power grid, garbage processing plants and
many other component of public amenities.

Population Policy Since 1947

The debate about population growth and family planning received impetus
in the late 1940 not only due to publication of the Bhore committee report but
also because of occurrence of several poor harvest. Further, 1951 census
revealed significant demographic growth. It was against this background that
Nehru announced that India would initiate a national family planning programme.
And India became the first country in the world to adopt an official National
Population Policy in support of family planning.
Govt allocated some money to the population program and started
promotion of modern contraceptives. Some achievements were observed in
larger towns in promotion of modern contraceptives. The govt. of Madras began
endorsing Vasectomy with success and was followed by Kerala Mysore and
Maharashtra. Madras also started making compensation payment to people who
were sterilised. By third five year plan, the objective of stabilising the growth of
population within a reasonable period was put at the very centre of Indias
planned development. The third plan document also noted the importance of
voluntary sterilisation and budgetary outlay was significantly increased.
Sterilisation camps began to be used to promote vasectomy.
The late 1960s also saw timebound and often unrealistic demographic
targets. The period of fourth Five Year Plan saw increased concern over the rate
of demographic growth. There was an increased emphasis upon targets,
compensation payment and male sterilisation.The emergency saw a massive
increase in vasectomies. But there was a backlash against the programme in the
northern states which lasted till 1980s.
The rhetoric of population control largely disappeared with the sixth plan
(1980-1985). Since the seventh plan, more emphasis was given to tailor the
family welfare program to the condition prevailing in the individual state, and to
involve the private sector more in contraceptive delivery. Incentive payments
and targets have largely been eliminated.

National Population Policy, 2000

Objectives
The National Population Policy (NPP) 2000 aims of achieving a replacement
level of total fertility rate by 2010. The long term goal is to achieve population
stabilization by 2045 at a level consistent with the requirement of sustainable
economic growth, social development and environmental protection.
Because of demographic change in India, the number of people in working
aga has increased. The census projection report shows that the proportion of
working age population between 15 and 59 years is likely to increase from 58%
in 2001 to more than 64% in 2021. Further it is likely to note that the bulk of this
increase is likely to take place in the relatively younger age group of 20-35 years.
Such a trend would make India one of the youngest in the world. The average
Indian will be 29 years old. This demographic dividend provided India great
opportunity and will benefit India if our population is healthy, educated and
appropriately skilled.
The immediate objective of NPP, 2000 is to address the unmet needs for
contraception, health care infrastructure and health personnel and to provide
integrated service delivery for basic reproductive and child health care.
The states (Tamilnadu, Karnatka and Gujarat) with low dependency rate
grew at much faster rate than the states with high dependency rate (Bihar,
Madhya Pradesh and Uttar Pradesh). Looking ahead, it can be said safely that
low growth state will benefit more from the demographic dividend. Lower
dependency ratio increases growth and higher growth reduces fertility and
consequently dependency rations.
Cross country evidence suggest that productivity is an increasing function
of age, with the age group 40-49 being the most productive because of work
experience. Nearly half the addition in Indian labour force from 2011-2030 will be
in the age group30-49, even while the share of this group in China, Korea and
USA will be declining.

The Experience of Kerala and Tamilnadu

In Kerala, with very low Infant and child mortality rates, the adoption of
two child norm has led to a total fertility rate of 2.0 which is below replacement
level of fertility rate. A universal female literacy and a low level of infant and
child mortality rate, combined with high status of women have played a crucial
role in decline in fertility rates.
Tamilnadu has received largest proportionate reduction in child mortality
among all major Indian states other than Kerala. Today, Tamnilnadu has third
lowest child mortality rate among major Indian states and second-lowest
maternal mortality rates. Among the same period, Tamilnadu also achieved the
largest proportionate reduction in total fertility rate. The decline in fertility in
Tamilnadu has been attributed to the political support for both an increase in the
age at marriage and an imaginative programme of information, education and
communication (IEC).
Enabling Factors: Recent studies shows that there were many enabling
factors which enabled Tamilnadus rapid demographic transition. Some of the
common cited factors include

Good Infrastructure
Rich history of social reform movement
High literacy rate in the younger age groups
Wide popular exposure to mass media
Strong political will
Relatively liberated status of women in contemporary Tamil societies
High female-male ratios
Little gender bias in school attendance
High level of female labour force participation

The relatively high level of female autonomy as indicated in recent

surveys shows the positive trend in status of women in Tamil societies. It includes
proportion of adult women who work outside the household (43%), who have
independent access of money (79%) and who are able to go to market without
permission from other family members (79% again). Extensive state initiatives in
the fields of child nutrition, health care and social security have also made an
important contribution in mortality and fertility decline in Tamilnadu.

Indias Demographic Dividend

In India, demographic transition a process of change whereby a society
move from a situation of high mortality and fertility to one of low mortality and
fertility difer from region to region. But there are two important consequences
of demographic transition.
1. The first is population explosion due to a rapid decline in mortality amidst
the maintenance of high birth rate.
2. The second is a shift in the age structure of the population resulting in
broader and long term age structural transition.
In the first phase of demographic transition, the number of children
increases both in relative and absolute size due to high fertility levels and a rapid
fall in mortality. After some time lag, as fertility rate starts declining, it contribute
to a decline in relative share of young population, As children born during
diferent phases of demographic transition move from youth to adulthood, the
age structure of the population undergoes major changes. During this process,
there will be a period of window of opportunity declines due to decline in
fertility as well as increase in the working age population, as children born during
the high fertility regime move into working ages. If this window od opportunity is
properly exploited, there is a greater potential for demographic dividend through
increased savings and investment for economic growth.
The period of Window of Opportunity can be exploited in three ways to
give demographic dividends
1. By productive employment of available labour force which would raise
total Gross Domestic Product (GDP)
2. By directing wealth and savings into productive investment. Households
tend to save less when there are more children.

3. Fertility decline will have direct and immediate impact on school going
population and provide an opportunity to invest more on their education
and health, contributing to a better quality human capital in the future.\
This would be onetimeonly opportunity and its length would be
determined by the speed of demographic transition. If appropriate interventions
are not made during this period, it would have negative implications for the
economy and society.