Demographic Dividend in India
Introduction
The debate over relationship between population growth and economic development is there since the much criticized theory of Malthus in 18th century. Economist focused on the size of population and the growth of nation, but the composition of population age structure was not considered until the study of Coale and Hoover (1958), but in recent years, demographers Bloom et al have studied the type of composition of age structure of population and its effect on economic growth and the concept of “demographic dividend” emerged. Demographic dividend is defined as a rise in the rate of economic growth due to a rising share of working age people in a population. This phenomenon occurs with a falling birth rate and the consequent shift in the age structure of the population towards the adult working ages. It is also commonly known as the demographic gift or bonus or demographic window. The demographic dividend, however, does not last forever. There is a limited window of opportunity. In time, the age distribution changes again, as the large adult population moves into the older, less-productive age brackets and is followed by the smaller cohorts born during the fertility decline. When this occurs, the dependency ratio rises again, this time involving the need to care for the elderly, rather than the need to take care of the young. In addition, the dividend is not automatic. While demographic pressures are eased wherever fertility falls, some countries will take better advantage of that than others. Some countries will act to capitalize upon the released resources and use them effectively, but others will not. Then, in time, when the window of opportunity closes, those that do not take advantage of the demographic dividend will face renewed pressures in a position that is weaker than ever.
Window of demographic opportunity in India India is in the midst of a major demographic transition. That transition started about 40 years ago and will likely last
The debate over relationship between population growth and economic development is there since the much criticized theory of Malthus in 18th century. Economist focused on the size of population and the growth of nation, but the composition of population age structure was not considered until the study of Coale and Hoover (1958), but in recent years, demographers Bloom et al have studied the type of composition of age structure of population and its effect on economic growth and the concept of “demographic dividend” emerged. Demographic dividend is defined as a rise in the rate of economic growth due to a rising share of working age people in a population. This phenomenon occurs with a falling birth rate and the consequent shift in the age structure of the population towards the adult working ages. It is also commonly known as the demographic gift or bonus or demographic window. The demographic dividend, however, does not last forever. There is a limited window of opportunity. In time, the age distribution changes again, as the large adult population moves into the older, less-productive age brackets and is followed by the smaller cohorts born during the fertility decline. When this occurs, the dependency ratio rises again, this time involving the need to care for the elderly, rather than the need to take care of the young. In addition, the dividend is not automatic. While demographic pressures are eased wherever fertility falls, some countries will take better advantage of that than others. Some countries will act to capitalize upon the released resources and use them effectively, but others will not. Then, in time, when the window of opportunity closes, those that do not take advantage of the demographic dividend will face renewed pressures in a position that is weaker than ever.
Window of demographic opportunity in India India is in the midst of a major demographic transition. That transition started about 40 years ago and will likely last