Wednesday, December 12, 2007

Some Reflections on US Demographic Data

Well, as promised in the comments to my last post, here is a little bit of US demographic data. This isn't the first time I have taken a brief look at US demography on this blog, and it surely won't be the last one.

This was an early attempt, where I tried to link the rebound in the US TFR that we can see from the mid 1970s to the start of modern-era large-scale immigration and to a slowing down in the birth postponement process in the US 'majority' population. The consequence of this have been a 'recovery' of those previously missing births (this process has also been noted in a number of societies in North Western Europe, for example in the United Kingdom at the present time, following the wave of migration from Eastern Europe). The US rebound can be clearly seen in the following chart:

This "recovery" trend continues, as outlined in the summary which accompanies the US Births Data for 2006 (preliminary) published earlier this month by the National Center for Health Statistics:

As a result of the increases in the birth rates for women aged 15-44, the total fertility rate –- an estimate of the average number of births that a group of women would have over their lifetimes –- increased 2 percent in 2006 to 2,101 births per 1,000 women. This is the highest rate since 1971 and the first time since then that the rate was above replacement -– the level at which a given generation can replace itself.

Now in general terms US demography can, I think, be given a pretty clean bill of health, as can be seen from the very solid looking population pyramids the US generates, and especially moving forward (see examples at the end of this post). The underlying situation is pretty stable and pretty sustainable, or so at least it seems. In part the US position is a result of the pretty unique movements in median age which occured in the 20th century (by developed country standards). The US seems to have found the "elixir of youth", and for this reason enters the next "ageing" stage from a comparatively priviledged position. This can be seen from the following median age chart.

What is most striking about the above chart is the way in which the US median age actually drops after the mid 1950s until the mid 1970s. This is a very surprising phenomenon, and I doubt anyone has really studied this in depth, especially since up to the present time noone really imagined that such shifts in median age were very important. Recent economic phenomena have of course started to put all of this back on the agenda, and I imagine someone, somewhere will get into this at some point.

It would be very interesting to understand this whole process a lot better, to see what can be learned from it, especially in the contaxt of trying to arrest rapid ageing in the not-yet-rich, newly developing countries. Basically the US in 1970 seems to have had the sort of median age which an Argentina or a Brazil have today, and yet it was the most developed economy of that time. What does this mean? What can we calibrate here?

Life Expectancy

Moving on slightly, while as I say in an ageing context US demography is very solid, there are negative elements. The first among these is evidently life expectancy, and in particular male life expectancy? This is significantly below that which is to be found in many other developed economies. What does this mean, and what economic conclusions can we draw from this? We know Americans work a lot, is this a case of burning the candle at both ends. (See this fascinating article from Colin Speakman et al: Living Fast, Dying When? The Link between Aging and Energetics, for an extensive review of the issues involved here).

Are life style and diet important? Certainly the recent rise in obesity and diabetes is setting alarm bells ringing everywhere. Researcher Jay Olshansky, in a controversial article in the New England Journal of Medicine in 2005, even went so far as to suggest that if the increase in obesity was left unchecked it could arrest or even reverse the whole trend for life expectancy to increase. Evidently in the context of the growing discussion of the rise of the so-called metabolic syndrome (diabetes and obesity, basically) these life expectancy problems may become aggravated, and this may sour the inter-generational debate somewhat.

At the end of the day what we have in the life expectancy department are a large number of unanswered questions. We have little real idea at this point, for example, of whether - once life expectancy reaches a certain point - we are really increasing our economically productive life to any significant extent, or whether we are increasing the number of years of (more or less pleasant, according to individual circumstances) dependent life. A useful summary of the whole state of the art in the great life expectancy debate can be found in this piece from the population reference bureau.


Immigration obviously forms a significant part of the US population growth story, and indeed immigration has had a major effect on the size, distribution, and composition of the U.S. population. According to data from the Population Reference Bureau, immigration contributed at least one third to the total population increase which took place between 1990 and 2000, during which time the number of foreign-born U.S. residents rose from almost 20 million to over 31 million.

Using rough and ready calculations based on the recent flows, the PRB estimate that the number of foreign-born persons (first generation migrants) may well to rise from 31 million in 2000 to 48 million in 2025, and if this is the case the foreign-born share of the U.S. population will rise from around 11 percent to about 14 percent. Accordingly, the number of second-generation Americans—the children of immigrants—will continue to increase.

In 2000, first- and second-generation Americans constituted about 21 percent of the U.S. population. If net legal and illegal immigration were to average around 820,000 per year, first- and second-generation migrant Americans will constitute about one-third of the U.S. population by 2025. Of course immigrants have played an important part in the recent increases in the US labor force simply because they tend to be of working age. Immigrants accounteded for nearly 50 percent of the total labor force increase between 1996 and 2000, and as much as 60 percent of the increase between 2000 and 2004. If net immigration were to run at the rate of 1 million per year, new immigrants and their children would effectively account for all of the growth in the U.S. labor force between 2010 and 2030 (PRB estimates). Of course all this begs some very important questions about the kind of economic growth we have been living on. For all the talk about productivity surges and total factor productivity it is important to take note of the fact that a good deal of economic growth is very factor intensive (ie it requires increases in the inputs of labour and capital). This point is important since while the availability of capital over the period from now to 2025 may well be pretty much guaranteed (all those ageing populations busy saving) labour force increases may be much more difficult to generate, as the traditional sources of migrant flows (and especially for the less skilled types of work) begin to dry up due to a combination of declining fertility and economic development in the countries concerned.

Before leaving this topic it is interesting to note that even while the total number of foreign born in the US continues to rise, the share of foreign born in the total population still is not as high as it was in 1910, although it is of course still climbing.

It is also interesting to note how the turn-around in the decline of the foreign born share (in the mid 1970s) more or less coincides with the fertility rebound.

The rebound is the product of a combination of two components (birth recovery among the US population of European origin who had been "postponing" and the arrival of a higher fertility migrant population, largely from Latin America, but it is hard to attribute weightings to each of these. What is clear is that the US aggregate population dynamic is a product of the overlaying (one on another) of two seperate dynamics, as I attempt to explain in this post (a tale of two pyramids). Just to remind us here are the local pyramids for each population. First the white non-hispanic one.

As can be seen, this pyramid is very similar to the ones we can find for some European countries (the UK, Sweden etc). And here is the hispanic pyramid.

Teenage Births

Another factor which has been something of an ongoing cause for concern among those who have been thinking about the US demographic situation is the relatively high level of teenage pregnancy which has been a factor over the years in the comparatively high achieved fertility rate. Now this problem, as can be seen in the chart below had been reducing, but out of the blue in 2006 we seem to have an uptick.

Of course as the CDC say it is far to early to attribute any significance at all to this, be the development is, in itself, interesting.

The report shows that between 2005 and 2006, the birth rate for teenagers 15-19 years rose 3 percent, from 40.5 live births per 1,000 females aged 15-19 years in 2005 to 41.9 births per 1,000 in 2006. This follows a 14-year downward trend in which the teen birth rate fell by 34 percent from its all-time peak of 61.8 births per 1,000 in 1991.

"It’s way too early to know if this is the start of a new trend," said Stephanie Ventura, head of the Reproductive Statistics Branch at CDC. "But given the long-term progress we’ve witnessed, this change is notable."

The largest increases were reported for non-Hispanic black teens, whose overall rate rose 5 percent in 2006. The rate rose 2 percent for Hispanic teens, 3 percent for non-Hispanic white teens, and 4 percent for American Indian or Alaska Native teens.

The birth rate for the youngest teens aged 10-14 declined from 0.7 to 0.6 per 1,000, and the number of births to this age group fell 5 percent to 6,405. The birth rate for older teens aged 18-19 is 73 births per 1,000 population –- more than three times higher than the rate for teens aged 15-17 (22 per 1,000). Between 2005 and 2006, the birth rate rose 3 percent for teens aged 15-17 and 4 percent for teens aged 18-19.

Global Rebalancing

Another issue which the US of course faces is the externally-related one of the changing global demographic enivironment. Whilst demographically speaking the US may well be reasoanbly stable, many parts of the world are evidently not, and some of these parts - Russia or China, for example - are evidently not. One of the strong arguments I have been advancing on this blog over the years boils down to saying (the obvious) that no man is an island, and even less so a country which is effectively wired-up to a globalised world economy. Changes elsewhere, it is clear, will be noticed inside the US.

One of the most obvious areas where this is currently the cases is associated with the role which the US dollar has been playing as a unit of measure for the global accounting system in recent decades. And this factor certainly does have a demographic component, since it is in large part the relative size of the US economy which lead to the transition from reliance on the UK pound sterling to use of the US dollar in the first place. Now demographics are once more at work, in the shape of the rapid arrival of a new set of potentially extraordinarily large economies on the global scene.

So it would seem that the US economy does now have something of a demographically driven adjustment problem (not in terms of the small adjustment which will be necessary as a result of the sub prime issue, which I think, incidentally, US demographics will make a lot less enduring than some imagine) but rather insofar as that the burden of carrying what is known among economists as Bretton Woods II had fallen squarely on the shoulders of the US dollar, and this reliance had the effect of encouraging people to accumulate rather more dollars than they actually needed. With the rise of the new global giants (also known as the BRICs) this system now seems to be in the process of unwinding with an ongoing recoupling of the global economy a recoupling which will in and of itself imply a reduced role and lower profile for the US economy (hene the interminable "decoupling" debates), associated with an ongoing diversification of currency reserves out of the dollar. As Claus Vistesen ably puts it in this post here:

You see, it appears that the old maid is a fitting metaphor for what at the moment seems to be a global game being played about not ending up being stuck with the Dollar.....the game is played and apart from the USD starring it could also seem as if a derivative of the old maid would be who in fact must step up to take the role for the USD as the structure of Bretton Woods II is ground down. Here of course, it will soon (i.e. after my exams) be time to re-visit old arguments but for now I will merely note that I always saw the current structure as very strong and fragile at the same time. It was/is very strong quite simply because de-coupling/re-balancing in the traditional sense where Europe and Japan ascends to take over the throne of the US would be virtually impossible. The fragile nature then comes in as an immediate consequence of this since if Europe and Japan cannot step up to the task who can and indeed will? As I say, fundamentals will tend to drive this and no-doubt the process of global re-coupling whereby the likes of India, Brazil, and Turkey takes over the clout of the US will materialize itself but a lot of glasses might end being shattered in the process.

So we are passing through a delicate moment, that part is clear. The world economy is changing fast, as revealed by the following chart which shows the shifting relative dollar values of the Japanese, the US and BRIC economies as % shares of global GDP. As can be seen the relative decline in the value of US GDP is virtually mirrored by the rising share of the BRICs.

Basically, if we can call the second half of the 20th century the "modern growth period", there were in fact two separate growth processes at work, a growth in wealth and income in the developed world, and an accumulation of population elsewhere. Indeed arguably it was the very rapid rise in population numbers (a by-product of the very high fertility levels) which was responsible for the stagnation in income and wealth which took place in these countries. Now, with fertility rates falling rapidly more or less everywhere , this balance is changing, and the former "underdeveloped" countries are started to accumulate not population but wealth, with the significant detail that they are doing this from very large population bases, with all the impact that this has in terms of global GDP shares and resource (climatic) pressure. Rather than calling ours a post-modern growth era, perhaps we would be better with "the epoc of the great unwind".

So, and briefly summing up, anyone in their right minds would be more than happy to trade population pyramids with the US of A, but this does NOT mean that the whole US situation is without its own very specific problems, different as they may be.

Appendix: US Population Pyramids


Anonymous said...

It would seem to me that BRIC growth, with the exception of India, is self-limited. Of course, we know of the catastrophic fertility situation in Russia. China has been below replacement for a long time, and is aging rapidly. In fact, the Chinese labor force will begin to decline around 2015. Brazil, although relatively young, is also below replacement fertility. India has seen dramatic fertility declines, but is still well above replacement.

So, it would seem that, to the extent today's pyramid is correlated with tomorrow's growth, the US has a relatively solid future compared to Russia and China, and to a lessor extent Brazil. Of course, the long-term EU situation isn't rosy. So, what countries will pick up the long-run slack besides India? There are some candidates in Africa and there are other countries in South Asia, but politics may dim prospects there. The truth is, the cupboard is pretty bare after today's BRIC growth spurt winds down.

CV said...

Hi Anonymous

'The truth is, the cupboard is pretty bare after today's BRIC growth spurt winds down.'


This is a very important point about the BRICs in the sense that Russia and China are very different from India and Brazil even if of course Russia seems much more on the ropes than China after all.

The point is many fold here and essentially Edward and I (as well as the others here at DM) are trying to pencil down the different issues as we go along. One of the main points as you mention here is indeed that the demographic transition seems set to hit the emerging economies and with a venegance too. Really, the striking correlation between economic growth and the DT ACROSS economic systems and institutions is perhaps the most remarkable and fascinating issue about all this from my desk at least. Now, this presents the global economy and financial system with tremendous challenges going forward. The point however is, as Edward and I have now become somewhat painfully aware of, that things seem to be moving much much faster than we initially anticipated and the longer we wait the more difficult it will be to get the house back in order.

'So, what countries will pick up the long-run slack besides India?'

Well, this is the point is it not or more specifically, what the hell happens when people start waking up to the fact that China will NEVER be driven by consumption, that Eastern Europe/Russia are destined to live off of exports etc? These issues demand that new approaches are developed in order to handle the economic issues going forward but so far we are left with the application of old models to new problems.


Anonymous said...

Brazil is below replacment? That is news to me. Population Reference Bureau says it is not below replacement and it's hard to find a better authority on the subject than them. And Russia will soon see population growth again if you belive the latest statistics. One economy that is wrongly overlooked with all the BRIC talk is Indonesia, the darling of foreign investors in the 80s and 90s. It has seen a stronger and stronger growth rate year by year since the crisis and is definitely one to watch, after all, it is the most populous country in the world behind the US, China and India.

Edward Hugh said...

Hi anonyomous No2,

"Brazil is below replacment? That is news to me. Population Reference Bureau says it is not below replacement and it's hard to find a better authority on the subject than them."

The US census bureau perhaps? They currently give it at 1.882 TFR for this year and dropping fast. But basically there is a lot of uncertainty attached to all of these numbers. What we do know is that - even on the PBR data (2.3 tfr) - they are at the very least closing on replacement fast, and about to bust on through.

On Russia I'm afraid it is very unlikely that there is any way back for them at all from where they are. I don't anticipate any reversal of the strong population decline in the forseable future (which is now to 2020, more or less, on my view).


"what the hell happens when people start waking up to the fact that China will NEVER be driven by consumption"

I really like your candidness here. And your forcefulness. If there is anything we have learnt in the last 6 months from all the time we have spent peering down a microscope into Eastern Europe it is surely that it is quite reasonable to draw this conclusion. It's the pace of it all, the pace, that is so staggering.

Edward Hugh said...

"and it's hard to find a better authority on the subject than them."

I'm afraid I'm getting stubborn in my old age, and I couldn't understand the PRB data (it is just a data sheet for convenient use I think), so I went and checked with the UN too. They have national data from Brazil, and they give a figure below the current PRB one from the late 1990s.

I also check their five yearly median forceast projections, and found that the number you would extract from this for this point in time would be the PRB number, so while I can't say this is what they have done, it does seem to be one possibility.

I think there is a big danger on many fronts of the old (2002) UN median projection being turned into tablets of stone here. Data quality in many countries is poor, so it is hard to get an exact fix, but all the evidence doies point to fertility falling more rapidly than anticipated in most of the rapidly developing countries, so my feeling is that the PRB estimate is a rather conservative one.

I am looking at a lot of data on fertility these days, and the US census bureau estimates, which often differ from the local national statistical office ones, do have the virtue of being coherent. Normally they more or less make sense to me, that is all I can say.

Well, this is a novelty. Very often when we do country studies we get sidetracked onto US issues, and this time we are actually on topic with the US and we have gotten sidetracked elsewhere :).

Anonymous said...

I couldn't find the Census Bureau statistics for Brazil. Could you give me a link? Anyway, I think Brazil has healthy TFR, too many people isn't good either, especially not in a natural paradise like Brazil.

Here's a link about the Russian situation. It is steadily improving and this year the population decline could already have grinded to a halt if you take into account net migration rates as well as the sharply improved natural growth rates.

Edward Hugh said...

Hi again Anonymous II.

"I couldn't find the Census Bureau statistics for Brazil. Could you give me a link?"

Yeah, sure. Here's the link to the US census bureau IDB portal. You can find a lot of very useful information under the country summary section, but playing around with the pyramids they let you create (and which I used for this post) can be interesting and good fun (or maybe that is just my wharped taste). I would like to be clear that I am not saying that the data they have at the IDB is necessarily any better than anyone else's, but it does have the advantage that it lets you see trends. The data in any given case can be a better, or a worse, estimate, but normally the important thing isn't the actual current reading but the trend. And for good measure here is the UN database page for population data. You can make the table you want here, download as an excel sheet, and even make your own chart if you like.

Also here is a link to the UN experts meeting held in 2002 on completing the fertility transition in the third world. The paper - in the country papers section - "what will happen to Brazilian fertility" by Ana Maria Goldani may interest you.

Incidentally, and while I am talking about the PRB, while I really love the work the PRB do, and often quote them, I am puzzled by the data they present on tfrs in the third world setting. Noticing the Tim Dyson paper at the experts meeting just now reminded me of this issue. The PRB gave a very good ppt presentation to accompany this year's data sheet. It is well worth looking at and only takes a couple of minutes. But I must confess to being puzzled by the state level data they present for India. I would say the South Indian estimates are way too high (Karnakata especially). Dyson is certainly one of the world authorities on Indian fertility, and 5 years ago, as can be seen from his paper at the UN meeting, he was giving much lower estimates for some of the Indian states. Basically South India is below replacement, and has been for some years. That is in part why the Indian economy is now growing so rapidly, since Central and South India are in their demographic dividend zone, and Northern India (Bihar etc) which still has very high fertility is supplying migrants to fuel the machine (as is Bangladesh in the south, not only in Karnakata, and Kerala, but also, and quite importantly, in Bengal). So some natural "rebalancing" is taking place here, as it did (say) in Northern Italy and Northern Spain (which became low fertility much more rapidly) in the 1960s and 1970s.

The point is, in India, just as in Spain and Italy, these South North (or North South) flows will eventually dry up as the country develops. The point here is that it may well be the case that modern economic growth is too people intensive. Neo-classical theory tells us that as people become the scarce resource wages should rise, and capital investment should become cheaper (which is a trend we are seeing in the third world to some extent at the moment) but neo-classical theory never envisaged the kind of global rebalancing we have going on right now, so we don't really know how this transition will work out in practice. Which brings me to:

"I think Brazil has healthy TFR, too many people isn't good either, especially not in a natural paradise like Brazil."

Look, anonymous II, I think we agree here. The high fertility countries need to reduce their fertility, that is how they get the demographic dividend and economic take-off. The point is, what they don't need is what has happened in Southern and Eastern Europe, Japan, the Asian Tigers, and now China and probably Thailand: namely watch reactionless as fertility steadily reduces to the lowest-low level. "Lowest-low" is a technical expression used by demographers to describe the problem which arises if you let fertility drop to the 1.2/1.3 tfr level, since basically it seems to be very difficult to get fertility back up over 1.5 again. It may be technically possible to tow a car which has veered off a highway into a marshland bog back up onto terra firma, but it may not be easy, and it would be better if the car hadn't veered off in the first place.

This particular problem has lead Austrian demographer Wolgang Lutz to postulate the low fertility trap hypothesis, which basically says that, as far as lowest-low fertility goes, it is very hard to make a come back, and the whole situation is non-linear. You can find a desription of this hypothesis here. At the present point in time it is simply a hypothesis and not a law, since we can only test the idea by observing what actually happens in parctivce, but there is already strong circumstantial evidence to support the idea, and particularly the fact that not one single country who fell to the lowest low level has so far made the jump back into the higher ranges. This becomes abundantly clear if you look at the chart for comparative fertility presented in the PRB ppt, where we can see that one group of countries (in this case Sweden, France and the US) have found a higher level equilibrium, while another group (Germany, the Czech Republic and Italy seem to be grouped together around a lower level equilibrium (these are the countries which are essentially caught in the trap). Particularly worrying is the German case, where, as you will see, we have seen virtually no movement in tfr in a long time. But the very presence of two separate equilibria already smells of non-linearity, and the presence of "externalities" of some type, whatever these may actually turn out to be.

So our argument here on DM is not that getting fertility down to 2.1 isn't a good thing, but rather that once you approach 2.1 (as Brazil is now surely doing even on the most positive scenario for Brazilian fertility) you need to put policies in place (especially relating to the rights of women, and support for motherhood) which try and brake the fall, and stop the whole thing crashing down to very low leves as has happened in ALL the other recently developed societies. The fact that not one single major multilateral organisation is currently pushing this gives us a measure of the extent of the problem, and does not serve to make me optimistic.

"Here's a link about the Russian situation. It is steadily improving and this year the population decline could already have grinded to a halt"

If we move on finally to Russia, I recently did a very long analysis of the Russian situation here. Basically you need to take everything the politicians say with a hefty pinch of salt. In general we tend to be assymetric in how we view all this, in that we tend to jump at the least bit of good news, while ignoring the steady flow of bad news. Russian fertility has been in decline for deceades, and it will take more than one or two months of good data to convince me that something important was happening. This small rebound in births is being noted all over the place, for example in Latvia, but it is very hard to attribute any real significance to all this at this point. Basically people have been inactive on the whole fertility situation since the 1970s, since we kept trying to convince ourselves that an uptick was just around the corner, and here we are in 2007 and in many cases there is still no sign of it.

As you note, Russia is living off immigration at the moment, but for how long can this continue? Most of the "supplying" countries are now experiencing labour shortages internally themselves, and even thos ethat aren't - Uzbekistan - will be within 5 to ten years. So where will the population to fuel the labour market come from then? And if in the meantime the inflation process that the shortages are producing causes the Russian economy to crash - as Claus and I believe it will - what will happen to the fertility uptick then?

Edward Hugh said...

Here's a short extract from the Ana Maria Goldani paper (and incidentally, one mystery is solved, the prb data come direct from the national statistics office, there is no interpretation, they simply report official national data, which may be biased and inaccurate in many ways. The UN in their projections and the UC Census demographers obviously try and make an educated guess about what is actually happening. In my experience their guesses may not be too bad, but that is simply a personal opinion from someone who has trudged through a lot of data).


Recent declines in Brazilian fertility, the continued use of sterilization as the main mechanism of fertility control and their concentration at early ages have led to a consensus in the demographic community that Brazilian fertility will soon be below replacement.

There is little disagreement among Brazilian demographers that fertility in Brazil will reach below replacement levels in the next decade although the official projections maintain that total fertility rates will be around replacement levels by 2050. There are different views regarding the pace and levels at which below replacement fertility rates could be reached. Moreover, there is no agreement about the irreversibility of this tendency or for how long Brazilian fertility rates will be below replacement.

The facts are that the recent steep fertility decline from 4.3 in 1980 to 2.2 in 2000 comes with increasing female sterilization among young married Brazilian women, which rose from 4 to 11 per cent for women age 20-24, between 1986 and 1996 (BEMFAM, DHS1986, 1996). Also, a steep decline in infant mortality from 116.9 in 1970 to 44.1 in 2000 contributed to the decline in fertility and increase in life expectancy. However, a large increase in mortality among young men 15-34 from external causes during the 80s limited the gains in male life expectancy and increased the gender gap. From 1991 to 2000, male life expectancy increased from 62.6 to 64.8 while females increased from 69.8 to 72.6 (IBG2002).

Below replacement fertility rates are already part of the demographic regimes of almost all Brazilian metropolitan areas, ranging from 1.8 in Belo Horizonte to 2.2 in Curitiba, compared to an average of 2.4 for Brazil in 1999.

Seven of ten married women in metropolitan areas that use some form of contraception have chosen sterilization for themselves or their partners (Wong, 2001). This high rate of sterilization may also explain the lack of a correlation between fertility and infant mortality among metropolitan areas. For instance, the metropolitan area of Salvador (Bahia) had one of the highest infant mortality rates (62 per thousand) and one of the lowest total fertility rates (1.8 children). Recent estimates and projections of total fertility rates by cohort and period suggest that fertility for Brazil will continue to decline and will soon reach sub replacement levels.

A concern among Brazilian demographers that the exclusive reliance on the conventional age-based total fertility rate (TFR) and period measures might contribute to the confusion about whether the current trends are real or short term fluctuations led to the generation of cohort age-fertility rates. The most recent findings confirm a systematic decline of fertility by cohort during the twentieth century with a total fertility rate of 6.9, 5.8 and 4.2 for cohorts of women beginning their reproductive periods respectively, in 1903, 1933 and 1963 (Horta and others, 2000). Another study projects fertility rates by cohort and suggests that total fertility rates below replacement (1.9) will be reached by women that began their reproductive years in 1988.The projection of fertility in the same study shows a total fertility rate of 2.0, 1.8, 1.6 and 1.5, respectively, for the years 2000, 2005, 2010 and 2015.

Anonymous said...

There are some Latin American countries with still-robust TFR's. These will supply the Brazilian labor market for quite some time. Of course, Brazil will have to compete with other countries in the region, such as Chile and the US, for labor in future. Canada has also been importing labor from Latin America. As I understand it, most of the best of Venezuela's oil work force now resides in Alberta.

Edward Hugh said...

"There are some Latin American countries with still-robust TFR's."

Indeed there are, Bolivia, Ecuador, Venezuela. As there are some notable high fertility Asian and African countries: Pakistan, Afghanistan, Ethiopia, Somalia etc.

What is most notable about these countries though is the political instability involved with having so many children and being so poor. This partly explains why so many Venezuelan oil workers are in Alberta, or why half of Quito just showed up in Spain.

Basically these countries will all start to modernise and catch the global trend at some point. (indeed I think the final "clean up" operation will be very rapid indeed here, since after China and India and Indonesia and the other big ones pass through the loop, all we will be left with are pockets of underdevelopment.

In the meantime, looking what countries like Norway and some of the Gulf oil states have been doing with their under the ground oil resources and futures, maybe some of these countries would be well-advised to strike Kyoto-type deal with first world countries, selling some sort of futures on their peotential working population to come, and using the resources now to develop infrastructure now. ie we will offer you some of the working population you will need in 2020 if you start building us highways, schools, hospitals and high speed trains now.

Anonymous said...

Interesting idea Mr. Hugh. Brilliant, in fact. A demographic futures market. So, for example, Germany might purchase a Guatemalan 100,000 population 2020 future, skill level 2, for $2 billion dollars. So, Guatemala would be obligated to deliver 100,000 semi-skilled workers by 2020. Now, say, Germany decided it didn't need the workers. It could then sell the contract on the open market to, say, Korea.

The price of such contracts would be set by the market, so that Germany (or other buyers such as Goldman Sachs or a hedge fund) might profit by holding them.

By jobe, I think you're on to something. Of course, the contracts would have to include certain rights and obligations for the workers so that this didn't become a situation which smacked of slavery or indentured servitude.

S.M. Stirling said...

Note that the distinction between Hispanic and non-Hispanic white populations in the US is increasingly artificial.

Around 1/3 of Hispanic marriages are to non-Hispanics, and this is distinctly higher among the native-born. That's a considerably faster transition to massive out-marriage than that which happened with the large immigrant waves of 1890-1914.

S.M. Stirling said...

Brazil's TFR is currently at 1.88 according to the CIA World Factbook; it dropped below replacement around the turn of the century, IIRC, but that's from memory.

It'll probably continue to drop sharply, since there are still extensive rural/urban, regional and class differences in TFR.

Given the usual tendency for behaviors to spread out from the cities and down from the upper middle class, I'd say it'll be at South European levels within a decade or so.

Edward Hugh said...

"A demographic futures market."

Hi. Yes I think this is what I have in mind, and I am reasonably serious about this, even if the idea is in a very rough and ready state at this point. If we take Guatemala, we can assume that like most other developing countries at this point, it is developing (something we couldn't say, take for granted, in the 1990s).

So by the mid 2020s it is quite probable that the country will be on the sort of growth path we are seeing in Brazil now (and maybe earlier, of course). But due to the high infant mortality, low life expectancy etc, people are dying NOW. So if we could find a way of advancing some of the wealth the country will undoubtedly have in the future we could obviously do something very positive in the here and now.

The issue is that the type of debt which has been accumulated in the past has not produced a very satisfactory outcome. Would this sceme work any better? I don't know, but it seems to me that it might be worth a try. It would obviously (like say the EU accession process) need to have an institutional "acquis" attached, and technical collaboration and assitance from the developed partner end. But I don't see in principle why it shouldn't work. It would be like joining a "virtual EU", or "virtual USA" for that matter. The Japanese are really in dire need of doing this too, even if at this point they are unable to recognise it, but if some (the UK, Sweden, Spain, Ireland??) got started, the rest would soon join in. Basically they couldn't afford not to. This whole process might even help improve the status immigrants have after they arrive, since they wouldn't simply be poor people arriving from who knows where, but partners in a process.

"So, Guatemala would be obligated to deliver 100,000 semi-skilled workers by 2020."

Well I think maybe we could change the wording a bit here, since as you say, if you don't the whole thing would smack of indenture and slavery, so why don't we say that Germany would offer a flow of work and residence permits to Guatemalans who want to come over a given period of years, as a sort of co-development partnership project. In return Guatemala would prioritise Germany as a migrant destination.

Basically the contract would need to incorporate some sort of obligation on the part of the Guatemalan government, so the thing would have to be backed by a real debt if the quota wasn't met (for example). The difficult part here is in the details, but they are resolveable I think, and I'm sure that someone with more experience than I have about how futures markets work could soon iron things out a bit better.

Basically both parties stand to gain, since whether or not people are willing to recognise it now, by the time we get through to the 2020s most developed countries are going to need an infusion of people, and with fertility dropping everywhere (or virtually everywhere) and with developing countries developing, migrant labour will at some point become the scarce resource, so why not assure your supply now?

On top of which, as you indicate, if you find that you don't need the people, you can always trade with a country that does. Population hedging.

Edward Hugh said...

Hi Sterling,

Nice to see you popping in, and have a good xmas if we don't meet up here again befoe (and all our readers).

"Given the usual tendency for behaviors to spread out from the cities and down from the upper middle class, I'd say it'll be at South European levels within a decade or so."

I go with this. I think the whole tendency we have seen since the tigers is for development ot be more rapid (in terms of growth rates) once it actually takes off, and this is normally accompanied by a "float like a butterfly, sink like a stone" effect in fertility terms. Brazil is definitely one of the principal beneficiaries of the sub prime bust and the money is literally flooding in right now, so my guess is that the changes here will be ultra rapid. As luck would have it, I just spent half my weekend at a Brazilian film festival. Construction is booming and you can see it everywhere, even out in the Gran Sertao, down come the favelas and up go the housing estates.

Edward Hugh said...


"Here's a link about the Russian situation. It is steadily improving and this year the population decline could already have grinded to a halt"

Well look. The number of live births in Russia is rising, and this is good news. But if we take the numbers for a moment, Medvedev announced 1,332,000 in 10 months. Adding 266,000 more for the last two gives us a total of 1,600,000. To put this in perspective though, in the mid 1980s 2,500,000 children were being born annually, and at that stage there was only a tfr of around the 2,1 minimum replacement level. So Russia still has a huge shortfall to compensate for in terms of making the pyramid stable, of course it can achieve this stability in the short term via immigration. But the question we are asking here on this blog is just how long this can last. How long in terms of the traditional "feedstock" countries having migrants left to come, and how long in terms of Russia's social and political system being prepared to adapt to and assimilate all these people. Remember that most of the migrants who go at present are temporary workers (Uzbekistan, Ukraine, China etc) the majority do not settle permanently and receive Russian citizenship, so they do not actually compensate for the birth gap. This position was masked in the late 1990s early 2000 since a lot of Russian nationals who had been dispersed across the USSR returned home, but this source is now increasingly dry.

Marc said...

In regard to Russia, it's worth noting that the recent uptick in births may be accelerating. The number of births in October 2007 is 18% more than the number of births in October 2006, whereas the yearly numbers show a mere 8% increase. From what I understand, the authorities are trying *very* hard to promote births, so I would expect the upswing to continue.

In other words, I think the Russian demographic situation can no longer be described simply as "catastrophic." A more up-to-date description would be "catastrophic, with the hope of becoming merely dismal."

Colin Reid said...


Your demographic futures market is a good idea from an economic perspective. However, politically it won't fly, because people in many first-world countries still see both immigration and emigration as a liability to their country. How can this be rational? Because departing emigrants are 'good' members of the local in-group who have gone astray by abandoning their peers, whereas arriving immigrants are outsiders and so are 'bad' and can only 'steal' jobs, benefits etc from the in-group, and be generally disruptive due to cultural dissonance.

Even if the economic argument could be used to beat the 'cultural' argument against migration, I'm sceptical that first-world countries have matured enough at a political level to avoid the mistakes made with the guest-worker programmes of the postwar period.

It's worth noting that with many migrant flows today, there is some kind of cultural similarity, for instance Latin Americans going to Spain, and if not, the lack of it tends to be a big factor in how much fuss it causes in the local media, who put relentless pressure on politicians to 'solve the immigration crisis' (whatever that's supposed to mean). In other cases, immigrant groups don't have an obvious cultural link to start with, but have become assimilated as a 'model minority', giving them something closer to in-group status, though this often takes a long time to happen - Chinese in the US certainly weren't considered a 'model minority' in the early 20th century, and were the motive for discriminatory immigration laws.

But I think it's going to be very hard for countries with either little history of immigration (eg Japan) or a history of failed integration of immigrants (depressingly, even otherwise 'ultra-progressive' Scandinavia hasn't done too well with this) to turn around the cultural and political mindset to the point where they'd actually be prepared to effectively *pay* for immigrants in the manner you describe. And given that old people are generally less able to adopt new ideas (or adapt to new cultures) than young people, there really is a closing window of opportunity on this score too.

(Interesting aside: the film 'Children of Men' could be seen as a parody of this problem. In the film, fertility has dropped to a dead zero for about 20 years, but there are still many migrants (mostly refugees, it seems, as the whole world has been thrown into turmoil). However, in the UK attitudes have become more hostile to immigrants to the point of herding them into labour camps.)

What might be easier to sell politically is the following: rich countries pay for development in the third world to *reduce* migration - ie, we'd rather generate jobs for Senegalese in Senegal than have them come looking for work in Spain, and we want to help them have fewer kids so the next generation of migrants is also smaller. However, there are political issues at the other end too: any kind of close bilateral relationship between a rich country and a poor country will draw accusations of 'colonialism', and any programme encouraging contraception of 'genocide by population control'. (Witness eg the fuss about polio vaccines in Nigeria, which got cooked up into a whole conspiracy theory of Christians trying to wipe out the Muslims by sterilising them. And those were only *rumoured* to have a contraceptive effect!)

Marc said...


Your comments are well-reasoned, and your thinking is well-expressed. I would add only a few necessary caveats.

One, the burden of assimilation doesn't rest entirely on the shoulders of the host population, but is distributed across both natives and immigrants. People who move to a new country ought to learn the language and respect the culture of that country, for the same reason that you should take your shoes off when entering someone's house if they ask you to do so: it's just polite. Many immigrants do this, but a significant minority do not. They should be called out on their refusal to assimilate, not sheltered behind the ideology of multiculturalism.

Two, you mention culture, but there is an even more contentious issue that people don't like to talk about but which nevertheless lurks below the surface in debates on immigration, and that is race and ethnicity. Even if Pakistanis in Britain enthusiastically adopted the customs and ideals of their host population, mass immigration into Britain from Pakistan would still meet with resistance because, deep down, a great many Brits would not relish the idea of becoming an ethnic minority. People don't articulate these sentiments a lot these days, but the taboo that prevents them from doing so seems flimsy in my opinion, as it is based on the erroneous belief that wanting to remain the majority in one's home country is irredeemably racist, and therefore, only terribly racist people would voice such a sentiment. In reality, you can want to keep Britian British, so to speak, without hating everyone who isn't British. (Hell, I'm an Italian-American, currently dating a recent Morrocan immigrant to this country. He's a great guy and I find his culture fascinating. But when I go back to Italy to visit, I want to see Italians, not Morroccans, and to be frank it's difficult for me to see anything wrong with that. I doubt Hakem would want to go back to Morrocco and see it populated by Italians, either.)

I am not saying that Morroccans are going to displace Italians any time soon. I just don't see that happening in this instance. But I think that in this era of collapsed first world birth rates and mass migration, the possibility in some countries is there, particularly in the medium to long term. And displacement isn't something you can expect everyone to take lying down.

Anonymous said...

I think the market mechanism would allow developed countries to create futures contracts only with countries whose workers they found attractive. So, perhaps the UK would avoid contracts with Pakistan given the obvious integration problems associated with some people from that country (ie, they would rather dominate than integrate). So, perhaps, the UK would sign a contract with Vietnam or Uganda rather than Pakistan or Yemen.

As with any traded good, different countries would have different comparative advantages. Kenya might produce excellent clerical workers, while Samoa was a manual labor specialist. India, of course, might be the place to find top quality scientific personnel, while the Phillipines offered excellent health care workers.

Countries with "unattractive" cultural characteristics, whether unattractive in general (ie, prone to crime), or unattractive due to lack of a specific cultural compatibility, would find their contracts far less valuable. That's the beauty of the market.

I think the current method of recruitment, employed by Sweden and Norway, for example, is fraught with peril. In the long-run, I would guess that Sweden will more closely resemble the Balkans or Israel than Scandinavia. Much better to select a culturally compatible immigrant population.

Anonymous said...

Here's a bit of what I mean:

Don't want to bring politics into the picture, but who would have imagined that professors would be murdered (stabbed in the throat or "slaughtered like a lamb") in broad daylight in Sweden, most likely for political or religious reasons. This is supposed to be Sweden! As anyone who lives in Sweden can tell you, it's not the same place most people believe it to be. Lots of crime, including violent crime. Many other social and political problems. I would almost call it social decay.

That's why it's important to select the immigrant groups, rather then have them select you.

colin reid said...

@marc: Of course integration is a two-way process, but for the purposes of attitudes to immigration, it's pretty much irrelevant *why* integration has failed, just that it has.

Race and ethnicity are cultural concepts. It's an aspect of culture that we form certain expectations of how people will behave based on their skin colour or nose shape, or that we consider some features to be more important than others. This is not to say it's specific to Western culture, but neither is it something that is set in stone or determined by nature. Look at the drastically different interpretations the US and Latin America have taken to the meaning of 'black' to describe a person, for instance, or the fact that the various northern Europeans who migrated to the US have essentially merged into one ethnic group, though they would not be regarded as such within Europe. (Most dramatic here is the case of German-Americans and English-Americans, who became pretty much indistinguishable around the time their cousins back in Europe were killing each other in French and Belgian fields.) Are English-Americans upset that they are now a small minority (10%ish?) in what was once an English colony? How much do they wish they could go further back, and see an America full of indigenous Americans?

Also, scenarios of wholesale population replacement are overblown when you consider that fertility is in decline almost everywhere, but you're right that the fear of this is an implicit or even explicit assumption behind a lot of the more extreme rhetoric.

@anon: The 'best' immigrants in terms of economic benefits, effects on crime figures and so on would probably be young married couples of a comfortable middle-class and well-educated background, even if they are from a poor country with very different culture. The UK had little trouble accommodating Ugandan Asians for this reason. The disadvantage Sweden has is that it has focused on taking in refugees, who start from probably the worst possible position in terms of chances to integrate and succeed. (One thing I do worry about is the strong negative correlation between (female) educational attainment and fertility even *within* a national population - as parents play such a large role in children's educational prospects, this is likely to really eat into the distribution of the world's educational capital. And that's even if we ignore any genetic component of educational achievement...)

Marc said...


Yes, race and ethnicity are cultural concepts, but they are cultural concepts overlayed on a biological reality. There are black people in America who would be considered white in Latin America, but genetic testing doesn't care about how society views a person, and said individual will show up with the same combination of European and African genes whether tested in America or Brazil. Cultural conceptions aside, different population groups do cluster together genetically, those clusters do conform very well to traditional notions of race (which have always made room for admixed populations), and the trend in the past forty thousand years or so (until very, very recently) has been accelerating evolution in different directions. Google +Cochran +Harpending "races evolving apart."

The failure to take this into account is a blind spot for many economists who look into demography and assume that Nigerians, Italians and Japanese, for example, are interchangeable. For some purposes they are: we are all humans and we are all variations on the same theme. But those variations can be important. If you want an excellent example of how genes may influence culture, read up on the University of Edinburgh's recent findings on ASPM and Microcephalin. Mutations in these genes that arose 5,800 years ago are most likely responsible for the switch from tonal to non-tonal languages in North Africa, the Middle East and Europe. This doesn't mean that people with the non-tonal variant of the gene can't learn a tonal language, or vice versa. (Obviously, any East Asian raised in the U.S. will speak English fluently, without spontaneously lapsing into a tonal version of our tongue.) But the studies suggest that, over time, the language of a society populated by people with one variant of the gene will most likely evolve into a non-tonal one, whereas that of a society populated by people with another variant will most likely evolve into a tonal one.

More relevantly, there is the explosive issue of race and intelligence. The mestizos (mostly Mexicans) settling in America have an average IQ of around 90, which is 10 points below the American mean. It may well be that this depressed IQ is a function of environmental conditions and that as these recent immigrants assimilate into society, their mean IQ will rise to parity with the American norm. But it is also possible that the difference is based partly or wholly in genetics, in which case no amount of cultural assimilation will completely eliminate it. I hope that the former scenario is the correct one, but I see no reason why the IQ gaps that persistently crop up between different racial groups absolutely cannot have a genetic component, when so many other differences have already been shown to.

If that is the case - and I hope it is not - then people who trumpet the current demographic situation in the United States and urge other Western nations to take in millions of third-world immigrants are being remarkably short-sighted.

Edward Hugh said...

Hello Colin.

As usual some very interesting and perceptive comments. I will just pick up on one or two points.

"Even if the economic argument could be used to beat the 'cultural' argument against migration, I'm sceptical that first-world countries have matured enough at a political level to avoid the mistakes made with the guest-worker programmes of the postwar period."

I understand your reservations, but you don't have to believe in Freudian psychoanalysis to reach the conclusion that there is often a reality principle at work in the background, influencing our decisions.

Now all I can tell you is that from everything we can see at the moment, the rate of change we are experiencing is very fast indeed by any known historical standards. Inflation is picking up incredibly in many countries in the fast-growing, structurally-damaged-pyramid group, and I don't think we are far from something somewhere having to give. 2008 in China is going to be interesting in this regard, IMHO.

And here there will be a before and an after. It is one thing the little Latvian train going smashing into the buffers, and quite another the huge Chinese one doing so.

So I imagine that at some point in the not too distant future people will start waking up to the fact that all this "fertility doesn't matter" bravado has been a mistake. Then there are only a few things you can do about it, one of them is to seriously promote long term improvements in the outlook and status of those women who take the responsibility of having children on their shoulders, and the other is the short term band aid of immigration. And here short-term will have to be "short term", since we are now about to move from a buyers to a sellers market in this regard.

Really, again if you look at reality instead of the spin, what we can see is that most of the recent growth in developed economies has been very people intensive. Just look at those economies who have grown substantially over the last 5 years - the US, Australia, the UK, Spain, Ireland, Sweden etc - and you will see they have all been sucking in immigrants in substantial quantities. Getting growth by raising TFP sounds nice on paper, but the reality is more complex.

So all those migrants that these societies both want and need to suck in are suddenly about to become the scarce resource, and the migrants themselves will be able to become more choosy. The boot will, as it were, be on the other foot.

Taking this point:

"I think the market mechanism would allow developed countries to create futures contracts only with countries whose workers they found attractive."

I think this will be true of those who get in first here. First come, first served, as they say, and beggars can't be choosers, or the devil will take the hindmost.

Basically I may be wrong, but I can't help feeling that the biggest shift of all here will come when the pension and health systems in one of the G7 countries actually crashes - Italy is the one I imagine will go first, but Japan now has serious problems, and the question is only how long people are going to keep funding the government debt as it gets more and more obvious that it is unsustainable.

So the first one to go will serve as an example (unfortunately), and after that, and when people are really faced with the danger of losing their pensions, then I think a lot of the nicetees will drop out of the argument, and people will be more and more happy to take immigrants, and from wherever.....

Just to conclude where I started, the acceleration which is happening means that reality is changing much more rapidly than most people's ability to process it can handle (and doubly so at the government and institutional level). Many of the policy proposals that people are pushing are way out of date even before they are implemented now, and there even seems to be something already "archaic" about much of the official discourse. So we need to leapfrog if we are to get anywhere on all these things. To give a final example, developing countries only account for 20% of planetary GDP at this point despite the large share they have in global population. But on a PPP basis they account for at least 40% (and their economies are growing rapidly). Well that PPP element gets corrected in the currency shifts, so they could very rapidly move to the position of having over 50% of real global GDP, almost in the blink of an eye. And from there on in the position is only up.

As I say, in Brazil it is tear down the favelas time, and up with the housing estates. Just look at the capital flows.

So if your pet remedy to all the world's problems is an upward revaluation of the yuan, be careful that what you actually get is actually what you had in mind when you asked for it.

S.M. Stirling said...

Note that the US has very little in the way of 'family-friendly' government measures, far less than, say, Italy.

Yet US fertility has been tending steadily, if slowly, upward since the 1970's. The current TFR is about the same as that of 1971, at the peak of the steep post-baby-boom drop. (It had been around 3.5 as recently as a decade before that.)

S.M. Stirling said...

The latest US figures are also interesting in that they show a very broad participation in the upward trend in TFR's.

It seems to be uniform across all age groups, with older women maintaining their recent gains but younger women, especially in the early to mid-20's, showing increasing fertility as well.

There's also broad participation across the educational and income spectrum.

Furthermore, there's no reason whatsoever to believe this trend is going to _stop_. It's been going on for quite some time now, since US and EU fertility developments started to diverge seriously in the 1970's.

There's nothing magic about 2.1; contrary to past UN assumptions, this number is not a 'strange attractor', either going up or going down.

So we may well see US TFR's at, say, 2.3 or 2.4 by the 2020's or even earlier.

At which point _world_ TFR's will probably be well below 2.1, and China (for example) will probably be at something like 1.2, with crude birth rates even lower because of the gender imbalance and the shifting age distribution.

If that happens, the US median age would start to drop and population growth to accelerate again, just as aging and population decline became the norm worldwide.

S.M. Stirling said...

As far as labor supplies go, note that the number of people turning 18 in the US exceeds 4,000,000 annually and is increasing.

Total _births_ are now also at record levels... and increasing.

The "increasing" is the crucial word to keep in mind here. The US will be -increasingly- able to maintain rapid labor force growth from its own resources.

S.M. Stirling said...

Looking at the EU and the US (or the US and developed East Asia), the striking thing is that the _lowest_ regional TFR's in the US are well above the average in either of those areas.

Vermont, which is the least fertile US state, has a TFR of 1.6 -- well above the EU average and higher than any but a few outlier countries.

Conversely, many US states have TFR's around 2.5 -- rates which would be fairly high even for North Africa or Latin America these days, and greatly in excess of anything a European country has had for generations.

For example, Mexico and Indonesia are currently at 2.38; even Egypt and Morocco are below 3.

Japan, if I remember correctly, hasn't had a TFR at the 2.5 level for over 50 years.

Edward Hugh said...

"Note that the US has very little in the way of 'family-friendly' government measures, far less than, say, Italy."

Agreed. But look. A couple of points. US fertility is what it is more by accident than by design, while French and Swedish fertility are very different from Italian or Greek fertility more by design than by accident. So if the "accident" component is going to knock you into a bad zone, it may be better to do something about it.

Let me give you an example from another sphere. The US state is, as you note, emphatically non-interventionist as a default setting (while some European societies have the default switch set at intervene). Yet the US is the home of Fannie May and Freddie Mac, and of the very highly interventionist Federal Reserve. Right now your government is busy trying to put together a very highly interventionist package (let's not get into the details of whether the precise measures are good or bad) to try to contain the distress impact of the sub-prime thing on the banking system and poorer families. I respect this "interventionist" component in US society, and often wish we were quicker off the starting block here in Europe in this regard.

So the point is that there is a consensus that "interventions" can sometimes be helpful, and most of the lack of consensus is about where and when they should actually take place (talking at this point about "reasonable people" and leaving out the ideologues at either end of the scale).

In the US, as you indicate, the state may not need any specific set of policies vis-a-vis fertility. But there is one important difference here between the US and Italy, since most US citizens are very much aware that fertility is an important question, and that the future of your society (which is much more individualist than the Italian one) depends to some extent on maintaining current levels.

In Italy the situation is quite different. They have convinced themselves that "fertility doesn't matter" and march boldly on into the unknown. That is they are in collective denial that the problem exists. In this environment it is very unlikely that fertility will rebound of its own accord, since noone gives sufficient importance to having it happen.

This is why serious government measures, including those which gave strong indications that male-centred behaviour, glass ceilings at work, and female empowerment are not simply issues to joke about over the proverbial mid morning coffee, but life and death questions for Italian society, would be more than a little helpful. Italy is a corporatist and not an individualist society (as are the rest of the Southern European ones, and the Latin American ones from which your newly arrived Latinos come) and government statements of intent can be a lot more influential than you might imagine. But if you simply brush the matter off with a 1,000 euro cheque here and there, then basically fertility will stay where it is, since most people will think, as the signals indicate, that it is a trifling matter.

Edward Hugh said...

"Furthermore, there's no reason whatsoever to believe this trend is going to _stop_."

Strange as it may seem Sterling, I don't really disagree. I mean, what I am really trying to say in the last comment is that I think people's expectations and awareness are now a big part of this story, so I would draw a sort of line in the sand between those societies which will be capable of reacting when it finally dawns that fertility really was an important issue and those who are caught in some kind of trap.

In this sense I wouldn't, as you seem to do, treat Europe as uniform. Basically what we have globally are those societies which have passed through the largest part of the fertility transition and managed to maintain fertility above 1.8Tfr, and those that haven't.

In Europe you can count in the UK, Scandinavian, France and Ireland in this regard. These societies are all very much "on board". Then there are the rest.

Globally we can only really add the US and Australia to this list (with Canada hovering). The rest of the emerging economies, I'm afraid, are headed down to the bottom rung of the ladder, and the faster the economic development the faster the decline into very low fertility it seems.

Basically the "lucky" group of countries are lucky since they have bought time (let's say 20 years or so) over the leading group (Germany, Italy and Japan) and will thus have time to react and correct when the full extent of the problem created becomes apparent. This may not seem "fair", but what scientific law ever said that life had to be fair?

So the above mentioned relatively higher fertility societies have a kind of "options put" in that once people become aware of the economic distress which can result from long term low fertility individuals will probably modify their behaviour and fertility may well tick up into higher regions than we can imagine now.

The thing is, this is why there is a certain urgency in clarifying whether the other group of societies may well not get caught in some kind of "fertility trap", where the negative economic trajectory makes it simply impossible for them to react with enough vigour.

"There's nothing magic about 2.1; contrary to past UN assumptions, this number is not a 'strange attractor', either going up or going down."

I agree, there is no homeostasis at work here. What I do now conjecture though is that we may have two "equilibria" here, a good one and a bad one. The group of countries with fertility over 1.8 may well be set on one path, and those with fertility under 1.5 on a very different one.

My only concern in the US case is what happens as Latino fertility drops from the very high 2.8 tfr current level, but as I suggest, this decline may take place in an environment where the general awareness of the fertility issue is very much on the rise, so there may be an automatic corrective mechanism about to come into operation even in this case.

Edward Hugh said...

"The "increasing" is the crucial word to keep in mind here."

Oh good, we are on the same wavelength again. I entirely agree, it isn't the actual volume but the development trend that matters. The contrast with China couldn't be more clear. China has just peaked (this year) in the 15 to 19 age group, at 125 million. From now on it is a forced march downwards, with the number dropping below 100 million by 2012 (IIRC). This is very dramatic, and will probably lead to a very strong labour market tightening in China, and over the next 2 or 3 years. So if you want to know what the fertility issue is all about, just keep your eyes glued on the China inflation numbers.

"The US will be -increasingly- able to maintain rapid labor force growth from its own resources."

Well look, this goes back to my earlier thing about population futures. Basically I think the whole immigration debate is really right up the spout right now.

A lot of people who know absolutely nothing at all about macroeconomics are given to spouting off about how ageing societies can increase their productivity, ie go for quality rather than quantity, at a time when all the evidence is that those societies which have been really getting relatively higher growth have been chewing up labour like there was no tomorrow. Even Germany and Japan, during their most recent surge, have created a very large number of low skill jobs, with a consequent steady drop in the unemployment level, but with no significant rise in average wages and salaries (which you would get if this was a standard productivity boost).

So societies need a constant flow of low skilled workers to grow, at least if we are to stay on our present course they do. So most societies need unskilled labour, and should be trying to live on their own resources and education system for the more skilled workers (of course this isn't working either, but lets leave this part for now). So.... what I am suggesting is that the deficiency in the higher skilled workforce can be supplemented by out migration of talented young people from those low fertility societies which are steadily going from bad to worse (Italy is the standard example here, but Germany isn't far behind). I'm not suggesting this is a good idea, I'm simply saying that this is likely to happen, and this is why there will be good and bad equilibria.

In this sense the US may be different, since it may be able to satisfy some significant part of its internal low skilled needs from internal supply (that surge in teenage pregnancies) while compensating for the deficiencies in the education system via immigration. This is a sort of "free riding", but again, where does it say that this is illegal?

S.M. Stirling said...

I'd like to see more detailed breakdowns of that US data on a number of fronts.

For example, already by 2000 7%-9% of children in some states -- including large ones like California -- were born to couples where one partner was Hispanic and one non-Hispanic.

Presumably the rapid increase in intermarriages during the 90's has been continued since 2000 and this is now a factor which is significant demographically on a national scale.

For example, here in New Mexico we have a Hispanic State governor, currently running for the Democratic Presidential nomination. His name is "Bill Richardson".

S.M. Stirling said...

When dealing with immigration and the US, it's important to keep in mind that ethnic boundaries here tend to be much more fluid than in Europe.

Or to put it another way, the US had -- and has -- a long tradition of assimilating immigrants, and from the evidence this is proceding, if anything, more rapidly now than in past generations.(*)

It's fairly hard for a Sikh to become _English_ in any meaningful sense, even if he's a British citizen; or for a Turk to become a German.

By way of contrast, the recently elected governor of Louisiana is Bobby Jindal, his parents were Hindu immigrants, he's a convert to Roman Catholicism, and his children are named Celia, Shaan and Slade.

Nobody but a fringe loop-loop would consider him anything but a normal middle-class American. To his grandchildren, the fact that two of their great-grandparents were from India will simply be a curiosity of no greater significance than the fact that Rudi Guiliani's came from Italy.

(*) for example, only a fifth of second-generation Hispanics in the US know any Spanish, and quarter to a third of US Hispanics are now Protestants.

Edward Hugh said...

"When dealing with immigration and the US, it's important to keep in mind that ethnic boundaries here tend to be much more fluid than in Europe."

Basically Sterling I entirely agree with you. I only think that perhaps here the British/English distiction is not the most representative example, since it is probably the most fluid "half way house" we have here in Europe. Arguably your Sikh - or his children - may well feel himself to be British (but never English) in a way which a Turk would be most unlikely to feel him- or herself to be really German. I can't help feeling that the recent demise of the UK conservative party has more to do with its stressing "Englishness" than anything else. The first thing they lost with this was Scotland, but also they have had great difficulty building an electoral base among the recently arrived British. In a sense this is because "British" is a civic identity not an ethnic one, just like American, I suppose. Just being a citizen is a sufficient condition to have the identity, since there are no "necessary" secondary properties attached.

S.M. Stirling said...

As far as the UK goes, the Conservatives generally get a majority of the popular vote in England -- they did at the last election, for example.

This is a pattern that goes well back into the 19th century, when the Liberals often formed governments based on minorities in England and very large majorities in Scotland, Wales and (in those days) Ireland.

Conversely, Tory governments with large English majorities and small minorities in the "Celtic fringe" have also been common.

If Scotland were to become independent -- no longer completely unthinkable -- the Tories would probably win most of the time in England and Labor might well collapse completely and be replaced by the Liberal Democrats as the main opposition party.

S.M. Stirling said...

Someone once said that England is to America as Judaism is to Christianity, which is both pithy and accurate.

To illustrate, in 2006 the US Centcom commander was an Arab-American and the general commanding ground forces in Iraq was the illegitimate son of a Mexican immigrant woman who cleaned houses for a living.

Simply contemplating the thought of a British general whose parents came from Pakistan, and whose second in command was the bastard son of a Jamaican charlady, illustrates the cultural gap.

Anonymous said...

The US has been adding about 100 million population every 35 years. No reason to believe this won't continue, so that by 2100 the American population will approach 600 million. If that is the case, the American and Chinese populations may be more or less the same. China will most likely resemble today's Japan by that time: wealthy, aged, and unthreatening.

The only other conceivable superpower at century's end will be India, assuming the Indian "empire" holds together. So, as far as I can tell, the US will continue to be the dominant global military and economic power well into the 22nd century.

Anonymous said...

When dealing with immigration and the US, it's important to keep in mind that ethnic boundaries here tend to be much more fluid than in Europe.
Or to put it another way, the US had -- and has -- a long tradition of assimilating immigrants, and from the evidence this is proceding, if anything, more rapidly now than in past generations

Yet America also has the ludicrous "one drop rule," which seemingly contradicts our greater willingness to assimilate immigrants.

Iron Rails & Iron Weights

Marc said...

Presumably the rapid increase in intermarriages during the 90's has been continued since 2000 and this is now a factor which is significant demographically on a national scale.

The rapid increase in intermarriages during the 90's was only found among whites and blacks. The rate at which Hispanics and Asians married whites actually declined between 1990 - 2000.

Historic patterns of racial/ethnic differences in intermarriage persist—Hispanics and American Indians are most likely to marry whites, followed closely by Asian Americans. African Americans are least likely to marry whites. Yet, the 1990s brought significant increases in intermarriage between blacks and whites; large increases in cohabitation did not offset the growth of racially-mixed marriages. The past decade also ushered in unprecedented declines in intermarriage with whites and large increases in marriage between native- and foreign-born co-ethnics among Hispanics and Asian Americans.

Robert said...

One difference between weak demography in Europe and weak demography in rapidly developing countries is that in the rapidly developing countries, the post-boom generation may be fewer in number than their parents, but also carries substantially more human capital per person. The potential productive power of the younger generation is underestimated by looking at population pyramids.

In the West, the younger generation is still better educated than their parents, but the rate of improvement in education standards has been slower and the population pyramid underestimates the productive power of the youth to a lesser extent.

Edward Hugh said...

Hi Robert, and Happy New Year.

"In the West, the younger generation is still better educated than their parents, but the rate of improvement in education standards has been slower and the population pyramid underestimates the productive power of the youth to a lesser extent."

I am sure this is true, and is one of the reasons why some emerging economies may now get very rapid TFP driven growth at some point, which - coupled with rapid currency appreciation - can close down the living standards gap in a much shorter space of time than many imagine.

I still think, however, that they need to change attitudes on there fertility decline, but some sort of family support systems ion place, and above all convince their citizens that fertility is an important national issue.

I still think this is the biggest difference between the US, France and Sweden and Japan, Germany and Italy. In the first three countries most citizens recognise that fertility matters, while in the other three they fervently deny that it does. You can see the outcome in the actual fertility numbers. A change in attitudes is the first, and most vital move.

Robert said...

Happy New Year to you, too, Edward.

If the post on longevity and work expenditure interests you, you might find an article by David Kahneman that appeared on Marginal Revolution a few days ago interesting. While "worked into an early grave" is a valid category, it is also true that unemployment is bad for longevity. Kahneman hypothesizes that happiness (the possible application to longevity is purely my own speculation) is linked to the variety of activity possible during an average day.

Edward Hugh said...

Hi again Robert,

"Kahneman hypothesizes that happiness (the possible application to longevity is purely my own speculation) is linked to the variety of activity possible during an average day."

Yep, well I find this idea very plausible. It is something I have even worked on in my own life. As must be obvious my "hobby" (and one kind of social life) involves me sitting many hours in front of a computer. I am happy with this, but it doesn't fulfil my need for variety, so in order to make a living to pay for all this enjoyable "work", I have deliberately chosen activities that involve direct face to face contact with people. So income generation also becomes a form of social life.

Of course, we are very much in "young Marx" territory here, not he of the communist manifesto, be he who was still under the influence of German romanticism. Now how did it go .... "hunter in the morning, fisherman in the afternoon, critical critic in the evening".

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