Sunday, April 19, 2015

Shrinking Japan’s population; World would follow in few decades

Japan, a leading indicator

Ghost of Malthus would be laughing at this news. Japan’s population is shrinking and is at 15-year low. (Link: http://timesofindia.indiatimes.com/world/south-asia/Japanese-population-falls-to-15-year-low/articleshow/46974072.cms). Many European countries are showing similar trend and their population is topping out. Though population in South Asia and Africa are rising, growth rate is not high as before. This is despite significant improvement in life expectancy and low infant mortality. What is driving this phenomenon?

Theory behind it

Demography theory is better explained with population pyramids. Look at the chart. Typical demographic transition happens in four stages. Sharper the pyramid, higher is the population growth rate. 

Typical demographic transition (Source: Wikipedia)

As it becomes oval, there are more ageing people and lesser is the replacement rate. Look at below chart. It shows that Angola is in the first phase of demography but Japan is in the fourth of phase of it.
Source: wpolitika.wordpress.com

Driving factors

The reasons for transition are both economical and sociological. As a country begins its economic growth, their incomes rise, availability and affordability of medical services goes up, so is the life expectancy. That lets the pyramid start expanding at the top. When economy does better, it improves education levels and lifestyle of its people. It also takes up the marriage age of women too. Learned women will have better career prospects; have income and a wide range of choices than remaining a housewife. That along with late marriage leads to fewer children and smaller families. For population to expand, every couple (on an average) should have more than two kids. If every family has just two kids, they are just meeting the replacement rate. And if some of them prefer to be happy with a single kid, they are contributing to shrinking population. Urban region show this trend of reducing replacement rate first and it spreads to rural area in one to two generations. Similarly developing countries would follow developed nations with a gap of few decades. Reducing female to male ratio, double-income and no children couple expedite this trend.

Transition to last phase

Though life expectancy is going up, humans are not yet immortal, so the expansion at the top of pyramid too has a limit. When the birth rate or replacement rate falls, expansion at the bottom of pyramid reverses and begins to shrink. So the population growth tops out and begins to shrink like it is happening in Japan now.

Where is India?

What is happening in Japan will happen in India and other countries too. Our chart shows we are in the second (expanding) phase but reducing population growth rates indicate we are transitioning to stationary phase.

Source: www.fdbetancor.com

Look around your neighborhood. How many families do you spot having more than two kids? Most of my friends in Bangalore are happy with one kid. I guess this is the trend in whole of urban India. Rural India will catch up with it in another generation. So in two-three decades from now, we can expect India’s population to top out too and begin to shrink by 2050 as the above chart expects.

Then we will have people living longer but also leaner families. The rush at schools, children hospitals would moderate. And there will be more grandma and grandpa around.