Demography & Growth
The demographic transition has swept the world since the end of the nineteenth century. The unprecedented increase in population growth during the Post-Malthusian Regime has been ultimately reversed, bringing about signi.cant reductions in fertility rates and population growth in various regions of the world.
The demographic transition has enabled economies to convert a larger portion of the gains from factor accumulation and technological progress into growth of income per capita. It enhanced labor productivity and the growth process via three channels. First, the decline in population growth reduced the dilution of the growing stocks of capital and infrastructure, increasing the amount of resources per capita. Second, the reduction in fertility rates permitted the reallocation of resources from the quantity of children toward their quality, enhancing human capital formation and labor productivity. Third, the decline in fertility rates a.ected the age distribution of the population, temporarily increasing the fraction of the labor force in the population and thus mechanically increasing productivity per capita.
This research develops the theoretical foundations and the testable implications of the various mechanisms that have been proposed as possible triggers for the demographic transition. Moreover, it examines the empirical validity of each of the theories and their significance for the understanding of the transition from stagnation to growth. In particular, it examines various mechanisms that have been proposed as possible triggers for the demographic transition and assesses their empirical significance in understanding the transition from stagnation to growth. Was the onset of the fertility decline an outcome of the rise in income during the course of industrialization? Was it triggered by the reduction in mortality rates? Was it fueled by the rise in the relative wages of women? Or was it an outcome of the rise in the demand for human capital in the second phase of industrialization? The analysis suggests that the rise in the demand for human capital in the process of development was the main trigger for the decline in fertility and the transition to modern growth