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Wednesday, August 24, 2005

Wolfgang Lutz and the Low Fertility Trap

OK, let's subtitle this post "On the Importance of Wolfgang Lutz".

But before I get into what this means, there is an important detail which needs to be clarified: this relates to the way economists tend to use the term fertility. Basically I think there is a very lax useage around. Fertility can be used to mean the number of children born per woman of childbearing age in any given society or the Total Fertility Rate (TFR).So when we talk about say 'low fertility' societes, we are generally suggesting that statistically they have (lets say) a TFR of less than 2.1 (replacement level). But there is another, stricter, shall we say biological, sense in which fertility is used, to refer to the capacity of males or females to reproduce. If I say low fertility societies are not necessarily societies with high levels of infertility (although that may be the case) the distinction should be clear. I think the origins of this kind of confusion lie in the fact that biologists and demographers tend to use the terms fertility and fecundity differently. For biologists, fertility refers to the ability to conceive, whereas fecundity refers to quantity of actual offspring. For demographers, fecundity (or fecundability) refers to ability to conceive, whereas fertility refers to quantity of actual offspring. From this point on I am using the demographers terminology.

Why is this distinction important? Well this relates to the extent to which Malthus was right and Malthus was wrong, and the implications for the ways in which this nuance comes out in some versions of modern growth theory. I will develop this a little more extensively as we go on, it's just the distinction which I think we need to be aware of at this stage. Of course, if you start getting interested in all this, the best read I can recommend is Harvard Anthropologist Peter T Ellison's 'On Fertile Ground' (subtitled a Natural History of Human Reproduction). Ellison makes a lot of this distinction, and, I think, rightly so.

Now to take this forward I want to make another distinction related to the present demographic transition, and that is the one between tempo and quantum elements in fertility declines. What is all this about? Well the reduction in fertility (in TFR terms) which all OECD societies are currently experiencing has two components. The first, the quantum component, concerns the number of children eventually born to each woman, and the second, or tempo effect, relates to the timing of having children.

This distinction was originally made in a paper by John Bongaarts and Griffin Feeney: On the Quantum and Tempo of Fertility (1998). A reasonably easy to understand version of all this is to be found in a Bongaarts paper: The end of the fertility transition in the developed world.

Now.... the tempo effect can be seen as having itself two components. Firstly the general quantum reduction means that there are generally less cases of the higher parities (that is more than 2 children). This has the effect that the average age of childbirth goes down. However this process is normally accompanied by a steadily rising age at first childbirth, and at some stage this second element begins to dominate over the first one and average age at childbirth in aggregate begins to rise. This is the tempo effect in the classic low TFR developed societies.

OK now you've struggled this far maybe I should mention the fact that demographer Tomáš Sobotka has a very interesting presentation about these issues.

Alright, now why is Lutz important? He is important basically I would argue since he identified the structural importance of the tempo effect - that permanent damage to the structure of the population ensues - even if final cohort TFRs ultimately are higher than anticipated, and that the only way this is overcome is by having a 'reverse tempo effect' at a later date, something which doesn't seem likely. This structural damage effect will turn out to have significant economic consequences.

Secondly he is important for having emphasised the critical 1.5 TFR boundary where negative feedback processes appear to set in which made it difficult to climb out of the hole. This has focussed our attention in a very important way.

As with all 'cutting edge thinking', it doesn't remain cutting edge for long, and Tomáš Sobotka is already (as can be seen from the presentation) modifying his ideas, although the substance still stands I think.

A fuller discussion by me of Lutz's 1.5 fertility trap ideas can be found here (in post and comments).

Here's another useful presentation from Lutz that I'm posting as much because I don't want to lose the link as for any other useful reason.


http://www.economicfractalist.com/ said...


I am riding on a limited express, one of the crack trains
of the nation.
Hurtling across the prairie into blue haze and dark air
go fifteen all-steel coaches holding a thousand people.
(All the coaches shall be scrap and rust and all the men
and women laughing in the diners and sleepers shall
pass to ashes.)
I ask a man in the smoker where he is going and he
answers: "Omaha."

Kindly visit the Economic Fractalist http://www.economicfractalist.com/

CapTVK said...


Those are some interesting presentations you've got there about the tempo effect and new methods to measure TFR. Although this new generation of indicators won't be as easy to understand.

It seems the academic debate is still on. I wonder which method is going to 'win the race' and become part of the regular demography statistics. ;)

Still there's the claim that "very low fertility is not a hallmark of the 2nd Dem. transistion" So there's something else going on in the background (which could be longer education, although the verdict is still out).

Keep the stuff coming Edward. I'm reading with interest.