Skip to main page content
U.S. flag

An official website of the United States government

Dot gov

The .gov means it’s official.
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you’re on a federal government site.

Https

The site is secure.
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

Access keys NCBI Homepage MyNCBI Homepage Main Content Main Navigation
. 2014 Oct 10;346(6206):229-34.
doi: 10.1126/science.1250542.

Is low fertility really a problem? Population aging, dependency, and consumption

Ronald Lee  1 , Andrew Mason  2 ; members of the NTA Network
Collaborators, Affiliations

Is low fertility really a problem? Population aging, dependency, and consumption

Ronald Lee et al. Science. .

Abstract

Longer lives and fertility far below the replacement level of 2.1 births per woman are leading to rapid population aging in many countries. Many observers are concerned that aging will adversely affect public finances and standards of living. Analysis of newly available National Transfer Accounts data for 40 countries shows that fertility well above replacement would typically be most beneficial for government budgets. However, fertility near replacement would be most beneficial for standards of living when the analysis includes the effects of age structure on families as well as governments. And fertility below replacement would maximize per capita consumption when the cost of providing capital for a growing labor force is taken into account. Although low fertility will indeed challenge government programs and very low fertility undermines living standards, we find that moderately low fertility and population decline favor the broader material standard of living.

PubMed Disclaimer

Figures

Fig. 1
Fig. 1
Per capita age profiles of consumption, labor income, and public and private transfers for the US (2009) (A, B, C) and Thailand (2004) (D, E, F). Profiles are expressed relative to the mean labor income of persons 30–49 in each country.
Fig 2
Fig 2
Effect of population growth on consumption per equivalent adult as a percentage of consumption level for zero population growth. Based on the low capital cost case assuming that the saving rate adjusts to keep the capital-output ratio constant at 3.0 given own-country mortality rates (A) and 2009 Japanese mortality rates (B). Values are simple averages for countries in three groups: lower income, upper-middle income, and high income countries. See Table 1 for countries in each group. Sources: National Transfer Accounts (ntaccounts.org) for consumption and labor income profiles; UN (2013) World Population Prospects 2012 for age specific mortality rates except for age-specific survival rates for Japan in 2009 taken from the Human Mortality Database http://www.mortality.org/ accessed October 16, 2013.
See this image and copyright information in PMC

Comment in

References

    1. United Nations Department of Economic and Social Affairs: Population Division. World Population Prospects: The 2012 Revision. United Nations; New York: 2013.
    1. United Nations Department of Economic and Social Affairs: Population Division. World Population Policies Database 2013. United Nations; New York: 2013.
    1. Bloom DE, Canning D, Sevilla J. The Demographic Dividend: A New Perspective on the Economic Consequences of Population Change. RAND; Santa Monica, CA: 2002.
    1. Arthur WB, McNicoll G. Samuelson, population and intergenerational transfers. Int Ec Rev. 1978;19:241–246.
    1. Willis RJ. Life cycles, institutions and population growth: A theory of the equilibrium interest rate in an overlapping-generations model. In: Lee RD, Arthur WB, Rodgers G, editors. Economics of Changing Age Distributions in Developed Countries. Oxford Univ. Press; New York: 1988. pp. 106–138.

Publication types