Demographic Transitions 1

DEMOGRAPHIC TRANSITIONS

Demographic Transitions: Analyzing Effects of Mortality on Fertility in Low Middle Income

Countries

Niaz Ahmed Bhutto, Rizwan Hafeez Dayo, Falahuddin Butt, Rashid Ali Lohach, Neetu Birjani

Sukkur Institute of Business Administration, Sukkur

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Abstract

The demographic and economic development literatures are mainly focused on the behavior of

fertility and mortality trends during demographic transitions. One of the school of thoughts

define that the fertility reductions are the consequent of mortality reductions during demographic

transitions. This study analyzes this relationship empirically by examining the low and middle

income countries since 1970. We analyze the impact of infant mortality, life expectancy and

crude mortality on fertility during transitions while controlling other explanatory factors. Our

results show that mortality plays large role in fertility reductions i.e. the major impact is of Infant

mortality, after that there is life expectancy. But on the whole, our study doesn’t support the

impact of crude mortality on fertility reductions; crude death rates are indifferent to fertility in

this regard. We find relatively little support for justifications of the demographic transitions

based on changes in GDP per capita.

Keywords: Mortality, Fertility, Demographic Transitions

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1. Introduction

In this era of economic development, many of the economies of world have transformed to the

better standards that are of life, education and technology. This is because of the demographic

transitions. Demographic transitions have been occurred in the early advent of 19th century that

is from the later pre-industrialization era to the industrialization and onwards. These transitions

transformed the world economy to the new horizons of growth and prosperity and still the

process is in progress. So, demographic transitions can be defined as the population changes to

levels of economic, education, and health-care development. It can be elaborated from one of the

explanations i.e. as women become better educated and financially independent, the global

fertility rates will continue to decline since women will (1) have fewer children, (2) delay having

them, or (3) forgo having them, so this tradeoff is also known as child quantity/quality tradeoff.

The demographic transition can also be meant the transition from higher birth and death rates to

lower birth and death rates as country develops from a pre-industrial to an industrialized

economy.

Many literatures and theories suggest that those declining mortality rates, decline due to the

transitions that pose some effects over the fertility. So, in this paper we will likely to contribute

by providing some empirical evidences of the effects of mortality reduction on fertility. Going

back in history, earlier this theory of demographic transition was given by Mr. Warren Thomson

in 1929. Traditionally the demographic transition began in eighteenth century in those countries

that are developed now and continues in our current era whereas in less developed countries the

process of demographic transition started later and is still at an earlier stage. Even there are also

those countries that are living below the basic standards of life (poverty line) and those countries

are far away from the process of transition i.e. they haven’t even stepped in the industrial sectors.

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 Demographic Transitions 4

Now coming towards the main indicators by which demographic transitions can be observed are

the mortality rates and fertility rates. Many of the theorists and researchers have observed

declining trends in both mortality and fertility rates as the country proceeds towards

demographic transitions. The fertility declines due to the increased awareness, family planning

programs, access to contraception methods, increments in wages, urbanization, a reduction in

subsistence agriculture, an increase in status and education of women and the parents’

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 Demographic Transitions 5

preferences i.e. child quality (raising the child by providing adequate resources i.e. proper

nutrition, education and proper attention) rather than the quantity. Due to increased life security,

parents prefer to have fewer children so they can raise them with care and proper attention.

Parallel to this scenario, mortality rates also decline due to improvements in food supply and

sanitation, which increase life span and reduce diseases. These improvements are due to new

farming techniques, access to technology, basic health care facilities and education.

For defining demographic transitions we will take the help of unified growth theory. This theory

was modified by Galor and it suggests that the transition from stagnation to growth has been an

inevitable by-product of the process of development. It argues that the inherent Malthusian

interaction between the rate of technological progress and the size and composition of the

population accelerated the pace of technological progress and ultimately raised the importance of

education in coping with the rapidly changing technological environment. The rise in industrial

demand for education brought about significant reductions in fertility rates. It enabled economies

to divert a larger share of the gains from factor accumulation and technological progress to the

enhancement of human capital formation i.e. the quality of child and income per capita, paving

the way for the emergence of sustained economic growth. In this way the transition from higher

birth and mortality rates to lower birth and mortality rates took place.

Due to the demographic transitions, two problems can arise i.e. birth rates may drop to well

below the replacement level and can lead to shrinkage in population that can be a threat to those

industries that rely on population growth. The other problem can be if the birth rates do not fall

corresponding with the fall in mortality rates so there can be a large increase in population that

may cause the issues of food insecurity, unemployment, diseases and many other calamities. So,

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the effects of mortality reduction on fertility may vary from the region to region or country to

country according to its position i.e. in which phase of transitions the country is. So, the ample

work has been done in the regard of demographic transitions and the reduction in fertility.

Demographic literature suggests many implications and theories in this regard.

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2. Literature Review

As we have discussed in the introduction: those demographic transitions are the changes in the

population that started in the early eighteenth century. Different authors have different

approaches to measure the demographic factors and have shown the impacts of each of them

over mortality and fertility. Many researches are concerned with the impact of infant mortality

reductions on the fertility reductions in the demographic transitions and therefore many

researches are done in this field. Most of the researchers suggest that the impact of mortality on

fertility is positive i.e. as mortality increases the fertility also increases. Apart from that scenario,

there are also other factors that are responsible for fertility reductions during the demographic

transitions. Therefore many of the studies are done. There are many trends in the behavior of

fertility during the demographic transitions. The main reason behind the shift in the trends is the

life expectancy. Due to demographic transitions the life expectancy in different regions has

increased because they have improved in health facilities so the fertility has decreased as authors

have quoted like Soares (2005), Angeles, (2010) & K.A.S. Wickrama Frederick O. Lorenz

(2002) they have shown that as life expectancy has increased, it has brought significant impacts

on reduction on fertility because preferences of women have been shifted towards having fewer

children due to the desire for quality of the children rather than quantity. In this way they can be

brought up in a very good manner and they might be productive in the future like they can make

better decisions about the retirements and savings Bloom et al. (2003, 2007). The decrease in the

mortality rates also decreases the fertility rates because demographic transitions theory suggest

that infant mortality decreases when we improve in education, health, urbanization,

industrialization, and improved medical services.

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Yet besides the factors described above, population growth has also significant impact on

reducing the fertility. As the fertility has decreased so it has also decreased the population growth

in many regions. There is positive relation between population growth and fertility rate.

Population structure gives significant results on demographic transitions Zheng et al. (2011). As

fertility decreases the youth dependency ratio also decreases quoted by Bloom et al. (2003).

Population growth rates and fertility rates have declined due to demographic transitions.

Transitions created awareness by facilitating the environment of good education, improved

health facilities, raised social standards, availability of hygiene food in the minds of those people

who lived in rural areas and were unaware about these facilities and it emphasized that more

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quantity of children in not good but they should focus on the quality of the children, Borooah

(2003). This is the reason why woman living in the rural areas have more children than of the

urban woman.

Another factor is the health issues that have been faced by the different nations over the different

periods of times. If the woman’s health is not good the chances are of high mortality rates and

high fertility rates because of the hope that few of them will survive. If children are diseased and

are unhealthy then those children will grow up to form sick adults, prone to disease, dampens

economic progress in many ways i.e. it decreases workers’ productivity, and reduces the

enrolment in the schools, and unavailability of the health facilities like vaccinations, doctors etc,

would be a burden because the health related expenditure will increase, world development

Report (1993).

On the other hand provision of information about the contraceptives may be good source to

reduce fertility. As it has been noted that transitions have started in the Asia and Europe, but they

are still in pre-mature phases in African Countries. Unlike other countries, in African Countries

the death rates are high because of the several diseases. Major among them is HIV/AIDS,

(Human Immunodeficiency Virus). Use of contraceptives has somehow impacts that the fertility

has been lowered, like use of contraception has increased from 12.4 percent to 27 percent and

consequently lowering the fertility Robinson (1992). Most writers suggest that by the use of

condoms the threat to HIV/AIDS is lowered and also lowered the fertility in this regard.

HIV/AIDS reduces fertility for infected women but has no effect for unaffected women Fortson

(2009).

Education is yet another factor as Boehmer & Williamson (1996) have used three key indicators

to show the gender specification theory. They are female secondary school enrollment,

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contraceptive prevalence and female/male ratio of secondary school enrollment. They have

formed the positive relation between the education and infant mortality rate. Apart from that an

educated mother is more likely to take good care of her child. Educated mothers try to give their

children good nutrition and diet, because they are well aware about the food requirements for

proper and hygienic nutrition of children (Gubhaju, 1986). The more funds spent on education,

the more will be awareness about bringing up the children, so reducing the risk regarding

mortality of their children. Generally it is observed that those educated women are more aware

about the contraception use than illiterate woman (Shah, Makhdoom A. et al, 1998). Educated

women have fewer children as compare to that of the uneducated one. Women with no schooling

have infant mortality rate above 2.5 times. In most cases the educated woman delays marriage

because they want to complete the education first, then they secure their careers and make their

lives stable in this way (Salehi-Isfahani, 2000). When we consider the education, it may be

private or public education. So, the parents who are likely to educate their children in private

schools have higher cost so they prefer few children (Azarnert 2006). The education of the

woman has negative correlation with the mortality rate as one author proposes that 1 percent

increase in the education level decreases mortality by almost 1.9 percent. Falling mortality is

associated with the increase in the life expectancy and it may enable the person to invest in

providing the better education of their children (Ram & Schultz, 1997).

Life expectancy is also a determinant of the fertility of the people. Life expectancy means for

how many years, people are expected to live alive. Life expectancy can reduce fertility by

changing the living standards of people through taking good care of their health and intake of

healthy food. The relation between life expectancy and fertility rate is negative, as life

expectancy increases, it means living standards of people improves that can reduce the fertility

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rate that means more people are expected to live alive for longer period of time. Mortality rates

no doubt decrease as it is a general view that when a person thinks that he can live long life

(Soares, 2003). When it is observed that the children are living for a longer period of time

definitely woman will want fewer children and this will reduce the fertility rates.

Generally the researchers believe that well-being of the economy (improved GDP) can have

impact on the mortality reductions like socioeconomic development (Moon, 1991). Whenever an

economy grows it makes substantial advancements in acquiring new technologies to improve

health and improve the living standard of masses, thus lowering mortality as well as fertility.

This all could be done through increasing the trade, urbanization and education. But in some

countries this is not the case, because there are such countries that have high income but their

infant mortality rate is higher than the countries having low incomes. This is mainly because they

do not make investments in the fields of health and betterment of the society like Oman, Iraq,

Iran, Gabon, South Africa and Libya (Pai, 1991).

In the article of Shen & Williamson (2000) they have shown that among other variables GDP has

always shown positive results in reducing the mortality. However there has been a substantial

impact of GDP over reduction in the infant mortality rates (Brenner, 1979). When economy is in

downturns and there are fewer jobs, people don’t find any job to earn income. So, they may not

be able to take healthier foods and they also fail to invest in health related issues causing more

fatalities. If people want more babies we can take it in terms of economics in which we consider

the income that we forego by working to bring up the every next baby to be born (Becker &

Lewis 1973). A family will send the child to the labor market if, and only if, the family's income

from non-child-labor sources drops very low (Basu & Van 1998).

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This article is further divided in three sections. The next section comprises of data and

methodology. Section 4 and 5; sum up the empirical results of the study and conclusions.

3. Data and Methodology

3.1 Variables and Data:

In demographic transitions, changes in fertility behaviours are observed. This study

revolves around the fact that during the demographic transitions, fertility is influenced by

different variables. In this study the impact of some of those variables on fertility is checked via

running a regression analysis. Considerably this study focuses on the impact of infant mortality

(IMR) on fertility (TFR) during the demographic transitions. The infant mortality rate is taken as

per 1000 infant deaths and the fertility is taken as the births per woman. The rest of the variables

are the control variables that are used in order to reduce the omitted variable bias. Low middle

income countries are still in the process of transition. So, the changing behaviours in fertility can

be observed by analyzing the data of 3 to 4 decades. Confining this study on the low middle

income countries, there are 56 low middle income countries that are taken into account for the

study. Each country is observed for the 40 years from 1970 to 2009. For considering the concept

of demographic transitions health expenditure, GDP per capita and inflation is taken into

account, whereas for the fertility behaviors, the variables: population growth, life expectancy at

birth and crude death rates are taken into account. Infant mortality rate (IMR) remains the main

regressor in this study. Analysis has been done by using a panel regression model on unbalanced

data that is taken from the databank of World Bank.

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3.2 Methodology:

In this section the econometric model has been run in order to do the empirical analysis

of our study. The empirical model is given below:

TFRit = βo + β1IMRit + β2HEit + β3LEit + β4PGit + β5(logY)it + β6INFit + β7(logDR)it + uit

Where: TFR = Total Fertility Rate

IMR = Infant Mortality Rate

HE = Health expenditure: Public (% of Govt: Expenditure)

LE = Life Expectancy at birth

PG = Population Growth

Log(Y) = Logarithm of GDP per capita

Log(DR) = Logarithm of Death rate: Crude (per 1000)

In this econometric model TFR is taken as the dependent variable whereas all other variables are

taken as independent variable. So, basically here in this model the impact of infant mortality is

studied on fertility in the demographic transitions.

4. Empirical Results

This paper examines the impact of infant mortality reduction on fertility in the low

middle income countries in order to observe the general behaviour of fertility during the

demographic transitions. The key regressor in this model is Infant mortality rate. The improved

standards of living and increased health and care facilities have reduced the ratio of infant deaths

in these countries and in result the fertility trends are also changing. This model tries to elaborate

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those changes and quantifies the findings. In the first basic model the independent variables

explain 70.5% variations in dependent variable. This shows the strong relationship and

significance of the variables that are used. In the first model the relationship between Infant

Mortality Rate and Total Fertility Rate is positive. It means that the infant mortality and fertility

are directly proportional to each other, so when the infant mortality rates increases, the fertility

rates are also likely to increase. As Angeles (2010) concludes in his findings that mortality

reductions have larger impact on fertility reduction and can account for the change characterized

by demographic transitions. This model also gives the same result and the relationship between

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IMR and TFR are significant at 1% level. This shows that the relation is very much robust. In the

same basic model there is public health expenditure, which exhibits the positive relationship with

TFR at 1% significance level. One possible explanation of this relation can be: there is less

availability of health facilities like vaccination, availability of doctor and hospital in some of the

low middle income countries, which increase infant mortality. The health expenditure in those

countries becomes a burden on government because it increases the expense so they are less

likely to invest in; (World Development Report, 1993). In response the parents become

concerned about their children’s survival and are likely to prefer the child quantity due to the

uncertainty. In this way the fertility increases with the increase in health expenditure. Apart from

the scenario of infant mortality we have taken the mortality rates at all stages in form of life

expectancy at birth. The relationship is negative and is significant at 10% level. This negative

relationship between life expectancy and TFR describes that higher the life expectancy lower

will be the fertility rates and vice versa. This happens because the parents feel very much secure

about their children, therefore they tend to focus on the quality of their children and prefer fewer

children in order to raise them with good life standards; (Lorenz, 2002) & (Soares, 2005). In the

basic model (a) the other variable is Population growth. The relationship between the population

growth and TFR is positive and 1% significant. Obviously this is the robust relationship because

the increment in fertility rates is considered as the population growth. Borooah (2003) concludes

in his findings that in demographic transitions both population growth and fertility decline due to

the good education, improved health facilities, raised social status and availability of hygiene

food. In model (b) two more variables are included. By the inclusion of these two variables the

R-square has jumped from 70.5% to 75.68% that represents that the additional two variables

have reduced the omitted variable bias and now the independent variables define 75.68% of

variation in dependent variable. First variable is the log of GDP per capita i.e. used in this model

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in order to analyze the relationship between total fertility rates and GDP per capita. The relation

is negative and 10% significant. It means that with the every percentage increment in GDP per

capita the fertility rates will decline. This is due to the fact that GDP is considered as the

wellbeing of any economy by many authors. So, the country having higher GDP per capita has

higher living standards which reduces the mortality and in response fertility declines due to the

child quality and quantity trade-off. But this is not always the case; there are many countries

which have still higher infant mortality rates in spite of higher GDP per capita.

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Dependent variable: Total Fertility Rate (TFR)

(a) (b) (c)

Constant 2.465060* 3.929322* 4.101333*

(0.791617) (0.959111) (1.510328)

Infant Mortality Rate (IMR) 0.021716* 0.016817* 0.016891*

(0.003303) (0.003530) (0.003571)

Health expenditure: Public

(% of Govt: Expenditure) (HE) 0.052020* 0.049713* 0.049774*

(0.008682) (0.009368) (0.009392)

Life expectancy at birth (LE) -0.019629*** -0.026430* -0.027908**

(0.009986) (0.009649) (0.013917)

Population Growth (PG) 0.570179* 0.605438* 0.599402*

(0.038704) (0.038309) (0.056080)

Log of GDP per capita

Log(Y) -0.119831*** -0.119688***

(0.066292) (0.066403)

Inflation: CPI(Annual %)(INF) 0.000221 0.000223

(0.000248) (0.000249)

Log of death rate: Crude(per 1000)

Log(DR) -0.034845

(0.236096)

R-Squared 0.705024 0.756842 0.756859

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Adjusted R-Squared 0.701764 0.752166 0.751386

Note: * is for 1% significance, ** is for 5% significance and *** is for 10%

significance level. In small brackets, there are standard errors.

This is because of uneven distribution of wealth and the less expenditure over health. That is

why in our model the relation is not that much robust and is aligned with the study of Angeles

(2010) who concludes that GDP per capita and the urban ratio have lesser impact on fertility

than the infant mortality. Apart from that there is another variable that is included in model (b)

is Inflation. This variable is highly insignificant and it doesn’t show any robust relationship

with fertility. By the inclusion of these both variables, life expectancy has become significant

at 1% level.

The final model includes one more variable in the existing variables i.e. Death rate:

crude. In order to observe the overall effect of death rates on fertility, the log of crude death

rate is taken into account. By the inclusion of crude death rates, the significance level of life

expectancy is shifted from 1% to 5%. The results suggest that there is no any significant

relationship between the fertility rate and the death rate. It implies that Total Fertility Rates are

not influenced by the overall crude death rates. This finding is aligned with the finding of

Angeles (2010) in which he suggests that infant mortality have very high and significant

impact on fertility rather than overall mortality. The significance levels of other variables

remain same as in earlier models.

5.Conclusions

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After, all the study and empirical analysis, this paper tries to add to the ongoing literature of

demographic transitions. This study tells about the role of mortality i.e. particularly infant

mortality in fertility reductions, by controlling other obvious factors that are present in the

economic and demographic literature. The main findings of this study can be abridged as

follows:

The findings of this study are inclined with the previous literatures regarding

demographic transitions. Mortality changes that are characterized as infant mortality play

very much significant role and have major impact over fertility reduction in demographic

transitions. We examine this relationship by controlling other variables that influence the

fertility trends in demographic transitions. There is positive relationship and it is very

much strong and statistically significant in all the models.

Life expectancy is also taken into account in order to check the effect of mortality rates at

all ages on total fertility. The results are somewhat fuzzy but still statically significant. In

first model it is significant at 10% then in second model the significance level increases

and in third it again decreases. So, this suggests that the infant mortality is very much

influential and has major impact over fertility rather than the mortality at all ages.

Whereas the impact of crude death rate on total fertility is concerned, the relationship is

highly insignificant. It means that as a whole, death rates or mortality has nothing to do

with the fertility reduction.

Comparable to the other explanatory factors that are responsible for the fertility changes
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during demographic transitions, GDP per capita is less significant. Whereas the effects of

mortality are very larger on fertility than other variables.

After these findings, turning towards the theoretical literature: we find that our research is very

much aligned with the mortality literature and it emphasizes the role of mortality changes on

fertility in demographic transitions. But it also makes some fuzzy explanations. It weakens one

of the most and equally big part of the literature that is the relationship between GDP per capita

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and fertility. In our study we used GDP per capita as the determinant of economic

development. Relationship was significant but somewhat tenuous. There is lesser effect of

GDP per capita on fertility than other main variables. This can be because of many other

factors that are responsible for economic development that influence fertility reduction. In

short, economic development might be the antecedent of mortality reductions and would

affect the fertility.

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Proceedings of 2nd International Conference on Business Management (ISBN: 978-969-9368-06-6)