Study: “Demographic Trends, Economic Growth and Distribution Dynamics”
PI(s): Bussolo, Maurizio
Co-PI(s): De Hoyos Navarro, Rafael E.; Medvedev, Denis; van der Mensbrugghe, Dominique; Horowitz, David S.
Affiliation(s): World Bank
Project Dates:
Start: 2007
End: 2011
Data Source(s): Household Survey Data
Methods: Global Income Distribution Dynamics (GIDD) Model
Geographic Location(s): Cross-Country Analysis

Description:
Fertility decline in much of the developing world has led to changes in dependency ratios, the size of labor force and spending and savings behavior. This has been called a “demographic dividend”, as workers become a larger share of the population and the scope for savings and per-capita income growth is boosted. When these larger cohorts of young people reach old age, this trend is expected to reverse.

This study analyzes the economic impacts of a delayed or a quickened decline in fertility rates in developing countries. Specifically, the study tests three hypotheses: delay of the decline in fertility rates during the next two decades will:

• Increase income inequality and slow poverty reduction;
• Slow the increase in urbanization rates;
• Strain education systems, making Millennium Development Goals more difficult to achieve

Research Outputs:

Bussolo, Maurizio, De Hoyos, Rafael & Medvedev, Denis. (2008). Is the Developing World Catching Up? Global Convergence and National Rising Dispersion (World Bank Policy Research Working Paper No. 4733).

Bussolo, Maurizio, De Hoyos, Rafael & Medvedev, Denis. (2010). Economic Growth and Income Distribution: Linking Macroeconomic Models with Household Survey Data at the Global Level. International Journal of Microsimulation, 3(1): 92-103.