Population and Poverty

	Millennium Development Goals
	Reproductive Health and the MDGs
	Economic Impact of Population Dynamics
	HIV/AIDS and Poverty
	Ageing Populations
	National Action to Reduce Poverty

Economic Impact of Population Dynamics

There is clear evidence that enabling people to have fewer children, if they want to, helps to stimulate development and reduce poverty, both in individual households and at the macro-economic level.

FAMILY SIZE AND WELL-BEING. Recent research supports the premise that having many (and unplanned for) children imposes a heavy burden on the poor, while smaller families have higher upward economic mobility.(2)

Fertility impacts on a family’s poverty in several ways:

• Smaller families share income among fewer people, and average income per capita increases. A family of a certain size may be below the poverty line, but with one less member may rise above the poverty threshold.



• Fewer pregnancies lead to lower maternal mortality and morbidity, and often to more education and economic opportunities for women. A mother’s death or disability can drive a family into poverty. Her ability to earn income can lead the family out of poverty.
• High fertility undermines the education of children, especially girls. Larger families have less to invest in the education of each child. In addition, early pregnancy interrupts young women’s schooling, and in large families mothers often remove daughters from school to help care for siblings. Less education typically implies increased poverty for the family as well as the inter-generational transmission of poverty.



• Families with lower fertility are better able to invest in the health of each child, and to give their children proper nourishment. Malnourishment leads to stunted growth, cerebral underdevelopment and subsequent inability to achieve high levels of productivity in the labour force.

MACRO-ECONOMIC IMPACT. High fertility impedes development in a variety of ways. The World Health Organization (WHO) Commission on Macroeconomics and Health noted in 2001, “At the societal level, rapid rural population growth in particular puts enormous stress on the physical environment and on food productivity as land-labour ratios in agriculture decline. Desperately poor peasants are then likely to crowd cities, leading to very high rates of urbanization, with additional adverse consequence in congestion and in declining urban capital per person.”

Lower fertility, on the other hand, is linked to economic gains. A 2001 study of 45 countries found that if these countries had reduced fertility by 5 births per 1,000 people in the 1980s, the average national incidence of poverty of 18.9 per cent in the mid-1980s would have been reduced to 12.6 per cent between 1990 and 1995.(3)

At the time of Cairo, econometric proof of this “population effect” on economic growth was difficult to obtain, and mainstream economists tended to dismiss it or play down its importance. A 1986 study by the National Research Council in the United States(4) concluded that population growth had little or no effect on overall economic growth, despite its important effects at the household level; but it relied on data from the 1960s and 1970s, when many developing countries were early in their demographic transition.

THE DEMOGRAPHIC WINDOW. A new round of research in the mid-1990s,(5) using data from longer periods, showed clearly that falling fertility opens a “demographic window” of economic opportunity. With fewer dependent children relative to the workingage population, countries can make additional investments which can spur economic growth and help reduce poverty.

This window opens only once and closes as populations age and the ratio of dependants (children and the elderly) eventually starts to rise again.

Several countries in East Asia—the so-called Asian Tigers—and a few others have taken advantage of this economic bonus. China has seen a dramatic drop in the incidence of poverty.(6) One study estimated that declining fertility in Brazil has raised the annual growth of GDP per capita by 0.7 percentage points. Mexico and other Latin American countries have registered similar effects. On the other hand, some countries have largely squandered the opportunity for a one-time “windfall” because of a lack of good governance or policies that have led to unproductive investments.(7)

In the poorest countries where fertility remains high, the demographic window will not open for some time, but investments now—particularly in improving reproductive health service delivery—could hasten its arrival and ensure future dividends.

The world’s regions are at different stages of the demographic transition. South Asia will reach its peak ratio of working-age to dependent-ages between 2015 and 2025. In Latin America and the Caribbean, the proportion in working ages started to increase earlier than in East Asia and will peak during 2020-2030, but the proportional change has been less marked, and the economic bonus will be correspondingly less sudden and less intense. Some Arab and Central Asian countries will approach their demographic opportunity within two decades, while others are farther away.

In much of sub-Saharan Africa the demographic bonus is still a long way off. The population is still very young and the proportion in working ages relatively low. Many countries are just beginning the demographic transition, and others have not even started. Only 11 countries are projected to reach their maximum working-age proportion before 2050. Unmet need for contraception in the region is high, however, suggesting the expansion of quality programmes could hasten the arrival of the bonus.

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