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In his recent address to the nation, Russian President Vladimir Putin devoted about 20 minutes to a proposal for a major constitutional reform designed to keep him in power indefinitely, and about twice as much time for ideas aimed at raising fertility. This is typical of European national conservative governments and even some relatively liberal ones that take birth support policies because of the dwindling population, writes Leonid Bershidsky for Bloomberg.
Maybe they have something in mind. In a working paper, Stanford University economist Charles Jones creates some models to show that so-called maternity policies can be “much more important than we thought” in determining whether nations and the world as a whole will find themselves with a declining population. and without economic growth or stable growth for both the population and the economy. The intuition behind the models is that growth is essentially a function of people’s ability to come up with new ideas, and if the number of people stops growing or declining, knowledge ceases to expand.
“The social planner wants the economy to have a much higher fertility rate,” Jones writes. But the global trend goes in the opposite direction:
Historically, birth rates in high-income countries have dropped from 5 children per woman to 4, 3, 2 and now even less. From a family perspective, there is nothing special about “over two children” versus “under two”, and the demographic transition may cause families to have less than two children. However, the macroeconomics of the problem make this distinction critically important: it is the difference between the Expanding Space of exponential population growth and the standard of living and the Empty Planet, in which income stagnates and the population melts.
United Nations population data show that the birth rate is declining sharply, even in those parts of the world where until recently it seemed that the level would never fall below the 2-woman replacement rate. In Asia, for example, this is expected to happen between 2055 and 2060. A more educated population and most women in the workforce mean fewer children, and these are factors that will not disappear in the foreseeable future.
In Europe, of course, population growth is already negative. In more affluent countries, the decline is still offset by immigration from places where too many people are born. This is the case in Germany and France. In post-communist Eastern Europe, maternity policies are the only obvious way to slow down the population decline, exacerbated by immigration, which the European Union’s free movement policy encourages. In addition, fertility policies go hand in hand with nationalism, with voters, and subsequently governments, being cautious in trying to increase immigration in a number of Eastern European countries.