Demographic Dividend Case Study

DEMOGRAPHIC DIVIDEND AND URBANIZATION IN THIRD WORLD COUNTRIES

ABSTRACT

The demographic dividend refers to the accelerated economic growth that begins with changes in the age structure of a country’s population as it transitions from high to low birth and death rates. But the demographic dividend is not, however automatic. Enough policies and investments have to be developed to achieve the demographic dividend. The critical policy areas include:

i) Changing population structure, ii) Investing in health programs for children and women iii) Educating children and youth iv) Promoting good governance

v) Enacting policies for economic growth

WHAT IS DEMOGRAPHIC DIVIDEND?

The basic concept of Demographic Dividend is that the rapid and sustainable

The demographic transition begins with break in mortality that shows a healthier population with a long life expectancy. A longer life expectancy causes fundamental changes in the way that people live. Attitudes about education, family, retirement, the role of women, and work all is likely to shift. If any society is taking a full advantage of its demographic dividend, it tends to experience deep-rooted changes in its culture, as its people become more valuable assets. With an increase in life expectancy, parents tend to choose to educate their children to more advanced levels. The parents also know that what benefits would each child get from schooling investments over a long working life and, with fewer children in a family; they can devote more time and money to each child. The result of this educational investment is that the labor force as a whole becomes more productive, promoting higher wages and a better standard of living. Women and men are being educated for longer, therefore tend to enter the workforce later, but they are likely to be more productive once they start working. All these mechanisms are heavily dependent on the policy environment. Only if there is sufficient flexibility in the labor market to allow its expansion, and if there are macroeconomic policies that permit and encourage investment, a growing number of adults will be productive. Similarly, people

from high to low birth and death rates. There are many countries in the world that are successful in reducing the fertility and the mortality rate. But there are still some countries remaining with high levels of fertility. These countries are not poised for a demographic dividend. As long as the fertility and mortality rates remain high, the size of the child and adolescent population will be larger as compared to the working age population. This will require a large number of resources to invest in health and well being of the children. If the government fails to provide sufficient resources, the country would not be able to move toward a dividend.

Hence, to achieve a demographic transition, countries must focus on lowering fertility. This can be achieved by providing men and women with adequate information and services about family planning. Many women in developing countries wants to avoid becoming pregnant but do not use modern family planning method. This leads to almost 80 percent unwanted pregnancies. When women can themselves choose when and how often to become pregnant, they tend to have fewer children and are able to achieve the desired family size. A country’s population age structure can begin to change, setting the stage for demographic