What does global aging mean for development?

October 13, 2010

     By Duncan Green     

Following on last week’s post on obesity, here’s another trend that’s rarely talked about (at least in development circles, with the honourable exception of Helpage International) – global aging. c/o Phillip Longman in Foreign Policy magazine.

“The global growth rate dropped from 2 percent in the mid-1960s to roughly half that today, with many countries no longer producing enough babies to avoid falling populations. Having too many people on the planet is no longer demographers’ chief worry; now, having too few is.

It’s true that the world’s population overall will increase by roughly one-third over the next 40 years, from 6.9 to 9.1 billion, according global aging 1to the U.N. Population Division. But this will be a very different kind of population growth than ever before — driven not by birth rates, which have plummeted around the world, but primarily by an increase in the number of elderly people. Indeed, the global population of children under 5 is expected to fall by 49 million as of mid-century, while the number of people over 60 will grow by 1.2 billion.

Today we see that birth rates are dipping below replacement levels even in countries hardly known for luxury. Emerging first in Scandinavia in the 1970s, what the experts call “subreplacement fertility” quickly spread to the rest of Europe, Russia, most of Asia, much of South America, the Caribbean, Southern India, and even Middle Eastern countries like Lebanon, Morocco, and Iran. Of the 59 countries now producing fewer children than needed to sustain their populations, 18 are characterized by the United Nations as “developing,” i.e., not rich.

Indeed, most developing countries are experiencing population aging at unprecedented rates. Consider Iran. As recently as the late 1970s, the average Iranian woman had nearly seven children. Today, for reasons not well understood, she has just 1.74, far below the average 2.1 children needed to sustain a population over time. Accordingly, between 2010 and 2050, the share of Iran’s population 60 and older is expected to increase from 7.1 to 28.1 percent. This is well above the share of 60-plus people found in Western Europe today and about the same percentage that is expected for most Northern European countries in 2050. But unlike Western Europe, Iran and many other developing regions experiencing the same hyper-aging — from Cuba to Croatia, Lebanon to the Wallis and Futuna Islands — will not necessarily have a chance to get rich before they get old.

One contributing factor is urbanization; more than half the world’s population now lives in cities, where children are an expensive economic liability, not another pair of hands to till fields or care for livestock. Two other oft-cited reasons are expanded work opportunities for women and the increasing prevalence of pensions and other old-age financial support that doesn’t depend on having large numbers of children to finance retirement.

global aging 3Surprisingly, this graying of the world is not by any means the exclusive result of programs deliberately aimed at population control. For though there are countries such as India, which embraced population control even to the point of forced sterilization programs during the 1970s and saw dramatic reduction in birth rates, there are also counterexamples such as Brazil, where the government never promoted family planning and yet its birth rate went down even more. Why? In both countries and elsewhere, changing cultural norms appear to be the primary force driving down birth rates — think TV, not government decrees. In Brazil, television was introduced sequentially province by province, and in each new region the boob tube reached, birth rates plummeted soon after. (Discuss among yourselves whether this was because of what’s on Brazilian television — mostly soap operas depicting rich people living the high life — or simply because a television was now on at night in many more bedrooms.)

Those who predict a coming Asian Century have not come to terms with the region’s approaching era of hyper-aging. Japan, whose “lost decade” began just as its labor force started to shrink in the late 1980s, now appears to be not an exception, but a vanguard of Asian demographics. South Korea and Taiwan, with some of the lowest birth rates of any major country, will be losing population within 15 years. Singapore’s government is so worried about its birth dearth that it not only offers new mothers a “baby bonus” of up to about $3,000 each for the first or second child and about $4,500 for a third or fourth child, paid maternity leave, and other enticements to have children, it has even started sponsoring speed-dating events.

China, for now, continues to enjoy the economic benefits associated with the early phase of birth-rate decline, when a society has fewer global aging 4children to support and more available female labor for the workforce. But with its stringent one-child policy and exceptionally low birth rate, China is rapidly evolving into what demographers call a “4-2-1” society, in which one child becomes responsible for supporting two parents and four grandparents.”

The pics are taken from the rather nice accompanying photo essay http://www.foreignpolicy.com/articles/2010/10/11/the_grayest_generation

There’s a striking pattern here. Whether it’s aging, obesity, falling fertility and mortality rates or improving literacy, the transitions (both good and bad) that a country typically goes through as it develops are happening at lower and lower levels of GDP per capita, raising new development challenges (e.g. aging without pensions, obesity coinciding with hunger).

And what does aging mean for policy? Off the top of my head, it should shift us away from just thinking about jobs and growth to broader aspects of well-being that are more relevant to older people, such as social and pensions; a more welcoming attitude to immigration in population deficit countries; working with and supporting self organization by older people (who are often more politically active anyway). And it may even help out in tackling climate change. But I’m sure Helpage and others will have lots of things to add ……

October 13, 2010
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Duncan Green
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