L14 Flashcards
Explain the demographic concept of pyramid and tower
Pyramid High birth rate and high death rate High youth dependency ratio Tower Declining birth rate and rising life expectancy High elderly dependency ratio
Explain demographic transition
= process when country’s demographic characteristics are transformed as it develops
1.High birth rate and high death rate
Hunger,diseases, famines, plagues and war
Low cost for having children, kids for insurance and labor, Low technology of fertility control
2.High birth rates and fall in death rates
Improve sanitation, Increase agricultural productivity, Biomedical medicine
Macro-inertia (Young age distribution, A lot of people in fertility age)
Micro-inertia (Incomplete information = think that children will die. Socioeconomic factors slow to adjust to falling death rate)
3.Low birth rates and low death rates
Less young women and lower birth rate
Parents update expectations, cultural norms change
Women starts working and opportunity cost of having child is higher
Causes of natural population growth
Birth rates - death rates • Mortality rates depend on ○ Life expectancy ○ Age structure of the population • Birth rates depend on ○ Total fertility rate is highly determining that Age structure of the population
Determinants of fertility
Contraceptives can help to reduce amount of children to wanted amount
But a lot of women in developing countries want a lot of children
Desired fertility is the key
Children are source of income
Children are source of insurance
Depends on mortality rate
Childs income
Social change with loss of family value
Parents life expectancy
If other source of insurance increase
Children are a source of satisfaction
Population growth pros and cons
-The bigger population, the lower GDP/capita (low living standards)
-Large young population will probably lead to bigger supply than demand of labor
-Environmental affects and other negative externalities (slums, traffic jams..)
-Challenging to provide schools, health, infrastructure
+Source of useful labor
+Source of market - more people want to buy and this can lead to economic growth
+Young people can contribute and take care of older population
Demographic dividend
High rates of labor force population and Still few old people and few children
- > High rates of saving
- > Frees up resources for investment that can make further productivity growth
- *If there is a lot of young people that do not have job demographic dividend can turn into demographic bomb. Political instability
Drivers of migration
-Pushed by adversity
Bad conditions in place you live
Conflict, natural disasters, no job, hunger
Rural-urban migration and international migration
-Pulled by opportunity
Higher wages, jobs, education
More likely to move if wage differences are big in a country
Immigrants tend to come from countries with low employment
-Family reasons
Joining family member that already migrated
Marriage
Migration: cost-benefit analysis
-Travel cost
-Adjustment cost (network, language, policies, job, house, culture) Significant barrier
If you have social network at destination it is much more likely that you will migrate
If a lot of people move to a place from same place it is more likely that this will continue
Much more likely to migrate to countries where they know the language
+Income gain
+Public good (health care, schools)
Migration does not just depend on one individual but it is a family decision
Cost and benefits are shared. Sometimes send one family member to other area to spread risk. One in rural and one in urban area if harvest is not good.
Harris-Todaro model
Focus on internal migration
Large rate of rural-urban migration in spite of high urban unemployment
Model show that it is rational if wage difference is high enough
Who migrates?
n curve
Takes money to migrate so more people migrate when income increase
More return to migration when country is richer (education give good jobs)
Less wage difference after a time
Impact of migration
- On migrants
Increased wages
The difference increased in time
Reduction in child stunting and increase in child high
Increase in adult obesity for migrants- On migrants’ families and communities of origin
+Remittances (sent from migrants. Sometimes it does not compensate for loss of labor.)
+Increased trade
+Reduced unemployment
-Loss of human capital (especially if highly skilled humans leave country) - On the host communities
Natives need to compete with immigrants with the same skills
But sometimes immigrants can provide complementary skills (for example low skilled jobs can help others to work which increase GDP)
In general immigration has small or no effect on wages but depends on skill level and education of immigrants
- On migrants’ families and communities of origin
Impact on country that is forced to hose immigrants
Big negative effect in the short run but in long run it can be good (lead to infrastructure, more trade, larger market, medical staff) but the effect are not equally distributed (for example good for farmers when food demand increase but not for employees at farm that experience more competition)
Difference brain drain and brain gain
*brain drain = emigration of country’s most highly skilled workers
*brain gain = increase human-capital level
Higher return on education. Thinking that you will move makes you more motivated to study. Some might stay.
Sending and sharing knowledge and expertise. Some might start business in home country.
