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The Child is Father Of the Man: Implications for the Demographic Transition

Authors


  •  Corresponding author: David de la Croix, IRES, Place Montesquieu 3, B-1348 Louvain-la-Neuve, Belgium. Email: david.delacroix@uclouvain.be.

  • De la Croix acknowledges the financial support of the Belgian French speaking community (Grant ARC 009-14018 on ‘Sustainability’) and the Belgian Federal Government (Grant PAI P6/07 ‘Economic Policy and Finance in the Global Economy: Equilibrium Analysis and Social Evaluation’). Licandro acknowledges the financial support of the Spanish Ministries of Education and Sciences and Technology (SEJ2004-0459/ECON, SEJ2007-65552 and ECO2010-17943). We thank Joerg Baten and Richard Steckel for making their data available to us. Two referees, Matteo Cervellati, Juan Carlos Cordoba, Nezih Guner, Moshe Hazan, Sebnem Kalemli-Ozcan, Omer Moav, Ruben Segura-Cayuela, David Weil, Hosny Zoabi and participants to seminars in Amsterdam, CER-ETH (Zurich), Bologna, Copenhagen, Hebrew University (Jerusalem), Humboldt (Berlin), IAE (Barcelona), IGIER (Milan), Marseille, Paris Nanterre, Paris School of Economics, Bank of Spain, Southampton, ULB (Brussels), Vienna, workshops in ITAM (Mexico), IZA (Bonn) and CREI (Barcelona) and conferences SED 07, PET 08, ASSET 08, SEA 08 and ASSA 09 gave very useful comments on earlier drafts.

Abstract

We propose a new theory of the demographic transition based on the evidence from natural sciences that physical development during childhood affects adult life expectancy positively. This theory is embodied in a continuous time OLG framework where fertility, longevity and education all result from individual decisions. We conclude that a sustained improvement in physical development is at the basis of the observed demographic transition in today’s developed countries and may be an important factor in explaining the slow transition from the Malthusian towards the Modern era. The dynamics of the proposed model reproduce the key features of the demographic transition, including sustained improvements in child physical development, permanent increase in life expectancy, a hump-shaped evolution of both population growth and fertility and late increases in secondary educational attainments.

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