| |
Of
aging societies, lost women, lost consumers
By Jayanthi Iyengar
PUNE - Remember the fears of population explosion, when the world's biggest
developing nations would push the global population to the catastrophic figure
of 10 billion by the turn of this century? Those fears are fading. Research by
the United Nations, the Austria-based International Institute for Applied
Systems Analysis and recent United States Census Bureau reports show that the
world is unlikely to see a doubling of its population, which is currently
pegged at around 6 billion. Instead, it is likely to peak at 9 billion by the
turn of the century, resulting in a straight reduction of 1 billion in
estimates from those made five years ago. Further, the global population is
expected to shrink as people have fewer children and live longer.
Asia, home to the world's most populous countries, is not growing as fast as
expected. Instead, it is graying, and quickly, though India is not graying in
the same manner as China. For the next 50 years, India will be graying into
middle age, while China, Japan and South Korea will gray into old age. Outside
Asia, the graying is taking place all over the developing world, including the
Middle East, which mitigates to an extent the geopolitical fears of an
expanding young, aggressive Muslim population dictating the future of the
world.
However, it also reinforces concerns over the kind of pressures that an aging
population would place on the economies of Asia and the developing world. At a
rough guess, these nations would have to provide for old-age support in the
form of health care and pensions. Families would have to forgo earning capacity
to take care of their elderly. The young and able-bodied in these nations would
have to pay for the consumption expenditures of their old. These may compromise
their own ability to work, consume, and generate wealth, which could impact the
future of these countries as the new geopolitical power centers, and compromise
their roles as the world's deepest consumption bins and labor bowls.
"As the relative numbers of dependent children decline, both China and India
are enjoying what some call a 'demographic dividend'," said Phillip Longman,
Benard L Schwartz senior fellow at the New America Foundation and author of The
Empty Cradle: How Falling Birth Rates Threaten World Prosperity and What to Do
About It. This means that today, middle-aged consumers have more to
spend on themselves because they have fewer children to support. "In the
future, however, both consumers in China and India will have to spend more and
more on the elderly, either by directly supporting their own aging parents, or
through government programs," Longman told Asia Times Online.
The causes for this change
To understand issues better, one needs to understand the basis on which
demographers make their calculations. The United Nations divides the world into
developed and developing for purposes of its projections. Within this broad
classification, there are four important factors, which have impacted
demographics. These include:
The sex ratio at birth.
The crude death rate.
The birthrate.
Total fertility rate.
The sex ratio is defined as male live births per 1,000 female live births. The
crude death rate is the number of deaths mid-year at 1,000 population, and the
birthrate is defined as the number of live births per 1,000 population.
Fertility rate is defined as the number of children born per woman. Until five
years ago, demographers had been placing their projections of the total
fertility rate averaging out at 2.1. This figure had been arrived at by
assuming that over time, a couple would tend to have two children. These
children would replace the parents in the population when the parents died. The
0.1 had been added to account for children who died before they reached the
reproduction age. Based on the 2.1 total fertility rate, it was assumed that
the population would double by the end of the century.
Yet emerging trends have shown that this is not the case, and the UN revised
its estimates of the total fertility rate to 1.85. As a consequence of this
revision, it is now being projected that the global population will peak but
then decline during the latter half of the century. This decline will not only
take place in the developed West but also in the developing countries. As Ben J
Wattenberg pointed out recently in on opinion piece in the New York Times, "In
the late 1960s, these countries had an average fertility rate of 6.0 children
per woman. Today it is 2.9 - and still falling." He is senior fellow at the
American Enterprise Institute and author of The Birth Dearth. "Huge and
continuing declines have been seen in countries like Brazil, China, India,
Indonesia, Iran, Turkey and (of great importance to the United States) Mexico."
He further added that the more developed countries, in contrast, had seen their
fertility rates fall from low to unsustainable. "Every developed nation is now
below replacement level. In the early 1960s, Europe's fertility rate was 2.6.
Today the rate is 1.4, and has been sinking for half a century. In Japan the
rate is 1.3," he said.
Development and education
Another significant assumption that demographers made until recently revolved
around development and education being considered the two major sterilizing
factors. It is for this reason that those who feared "poverty anywhere is
poverty everywhere" aggressively propounded the theory of elevating the lot of
the poor in developing Asia, Africa and elsewhere through foreign aid. They
also placed great emphasis on government intervention in population growth
through family-planning programs.
Yet recent trends in the developing world show that a break in the fertility
rate could be on account of factors other than education, aid and development,
such as poor women all over the world asserting themselves. Joseph Chamie, the
director of the United Nations population division, noted at a population
conference in 2002 after the multilateral agency had revised its estimates, "A
woman in a village making a decision to have one or two or at most three
children is a small decision in itself. But when these get compounded by
millions and millions and millions of women in India and Brazil and Egypt, it
has global consequences." As a consequence of such decision-making, experts now
estimate that the population in India alone will go down by 600 million from
the projections made earlier for this century.
China's 1 million missing girls
Further, in Asia, including India and China, the preference for the male child
is changing the demographics of these countries. A recent study by Nancy Riley,
professor of sociology and anthropology at the Bowdoin College in Maine in the
US and Population Research Bureau expert on China's population, raised the
possibility of widespread infanticide in China on account of the country's
one-child norm and the parental preference for boys. These findings are based
on the Chinese census figures of 2000. Riley explains that these figures have
been made public only recently, leading to a plethora of findings that raise
the specter of 1 million Chinese girls going missing by the end of the century.
Riley explained to Asia Times Online that though exact projections are not
possible, demographers use a standard demographic measure, namely the sex ratio
at birth (SRB). The SRB is not a global average. However, it reflects trends
seen in normal populations. "In all normal populations worldwide, the SRB is
105," she said.
Riley explained that there seems to be some biological reason why 105 boys are
born for every 100 girls (biologists think it may be because males have a
higher mortality rate at every age, so perhaps this higher SRB is a kind of
early protection). "There are many countries with SRBs higher than that, but
the highest SRBs are in East Asia, and the highest is in China," - 120. It is
this discrepancy that has raised the possibility of human intervention to turn
the demographics in favor of a male population in China.
The UN figures show that Russia's population is already shrinking in absolute
size. Italy, Spain and Japan will be doing so within a few years. India's
population will not shrink for many decades, but its annual growth rate will
slow to just 0.26 by 2050. China' population, by contrast, would shrink faster
by 2030.
"These unequal numbers of males and females are likely to affect marriage
rates. There will be have to some shift in the marriage patterns of some
people, since there just aren't equal numbers of males and females to match up
for marriage. Given that marriage and family are central to Chinese social
organization, perhaps this will have economic and other implications, as new
family forms are accepted and experienced," Riley said.
Longman, fellow at the New America Foundation, added that the sex ratio could
have implications as serious for India as they are for China. "The sex-ratio
problem appears to be getting worse in both India and China, and yes, it is a
major break on fertility." He pointed out that China's 1982 census counted
almost 109 baby boys for every 100 baby girls; by 1995, the reported ratio was
up to almost 116 boys for every 100 girls, and by 2000, it was approaching
120:100. Similarly, in the Indian state of Punjab there are 126 young boys for
every 100 young girls. "This will create a large surplus of unmarriageable men.
In China, roughly one of six men in the rising generation will not succeed in
putting [his] genes into the future," he said.
The comparative position in India and China
The sociological aspects apart, an aging population would also have
implications for investors in India and China. Demographers say that if one
were to go only by population and its composition, India might have an edge
over China. This is not because India is not aging - instead it is because it
is aging differently. "In general, India is in a better demographic position
than China. Both countries are aging rapidly, but India is currently a much
younger country, and will remain so through mid-century at least," said
Longman. This is because between 2000 and 2050, India's median age would rise
by 16.5 years to 37.9 years. By that measure, India would be aging faster than
China, which would see its median age rise by "only" 14 years. "India is no
exception to the Asian trend. Its southern provinces are already at
below-replacement-rate fertility. The difference is that India, for the next 50
years, will be aging into middle age, while China, Japan, Korea will be aging
into old age. The only real exceptions are Indonesia and the Philippines, both
of which still have fertility rates well above replacement levels," said
Longman.
He pointed out that part of the reason labor costs are cheap in China is that
society is not providing for the real cost of labor, which includes the cost of
workers imposed on society when they grow old. "China's social-security system,
which covers only a fraction of the population, is riddled with debt. Thanks to
its banking system, its capital is misdirected, and individuals have little
means to save on their own for old age. The same is true, to a lesser extent,
in India," said Longman.
Riley, the China population expert from Bowdoin College, said she is no
economist but her gut feeling tells her that "China is undergoing huge changes
in this area - the society is becoming much more of a consumer economy each
year - that the unequal numbers of boys and girls is likely to be grossly
overshadowed by other effects".
The demographics of India and China and the changing population pattern in Asia
are a matter of hot debate. Population experts such as Nicholas Eberstadt of
the American Enterprise Institute have already written extensively on power and
population. He holds the Henry Wendt chair in political economy at the American
Enterprise Institute in Washington, DC. Longman's book, The Empty Cradle,
was published early this year, while Wattenberg is in the process of completing
his own book on the subject, for September release.
As Wattenberg pointed out in his New York Times article, "There is not a
one-to-one relationship between population and power. Big nations, or big
groups of nations acting in concert, can become major powers. China and India
each have populations of more than a billion; their power and influence will
almost surely increase in the decades to come. Europe will shrink and age,
absolutely and relatively."
Jayanthi Iyengar is a senior business journalist from India who writes on
a range of subjects for several publications in Asia, Britain and the United
States. She may be contacted at
jayanthiiyengar1@hotmail.com.
(Copyright 2004 Asia Times Online Ltd. All rights reserved. Please contact
content@atimes.com
for information on our sales and syndication policies.)
|
| |
|
|
 |
|
