It is not news that total fertility rates across most countries are declining, and have been for some time (see the links at the end of this post). However, in spite of declining fertility, many population projections assume that fertility decline will come to an end, or even reverse. For example, the UN World Population Prospects projections assume that fertility rates eventually enter a relatively stable phase, with an average long-run level of about 1.6 births per woman, although the assumed stabilisation level varies across countries (see page 29 of this methodological report). Similarly, Stats NZ assumes that the median period total fertility rate will slowly decline from 1.59 in 2025 to 1.55 in 2054 and beyond (see here).
Given that it has been relatively rare for total fertility rates to reverse trajectory, how realistic is it that they will attain some stable equilibrium in the future? This new NBER Working Paper by Diane Coffey, Michael Geruso, Dean Spears (all University of Texas at Austin), and Sangita Vyas (City University of New York), digs into the data to provide an answer. Specifically, they look at data on:
...period total fertility rates (TFRs) for all country-years since 1950 in the United Nations World Population Prospects, in completed cohort fertility for country-cohorts in the Human Fertility Database, and in fertility measures from subnational geographies in India, Japan, and the United States.
It is worth taking a moment to explain the difference between a period total fertility rate and a cohort total fertility rate. Most of the time, the statistics we see reported are period total fertility rates. Those are the number of births a woman would have across their lifetime if they experienced the age-specific fertility rate at each age in that year. Of course, each woman only experiences the age-specific fertility rate of one age in any one year, not all of them collectively. That brings us to the cohort total fertility rate, which is the average number of births each age-cohort of women (born in the same year) actually have across their lifetime. Completed cohort fertility is computed after an age cohort of women has effectively moved out of childbearing age, which is why this statistic isn't reported often - you have to wait until women are over 50 years old before you can be confident that you have an accurate measure of the cohort total fertility rate. This distinction between the two measures matters because period fertility rates can decline if women delay having children, even though the cohort fertility rate (the average number of children women have over their childbearing years) remains unchanged.
Now, coming back to the working paper by Coffey et al., they use phase diagrams to illustrate the trajectory of total fertility rates over time. A phase diagram graphs the change in a variable against the level of the variable. It essentially shows, for each level of the variable, whether the variable is increasing, or decreasing. If a total fertility rate is to stabilise at some level, then the phase diagram should show that for low levels of the rate, the change is positive, while for high levels of the rate, the change is negative. The level where the change is equal to zero is the level at which the rate would stabilise. In other words, for fertility rates to stabilise at 1.6 births per woman, we would expect them to increase if the rate is below 1.6 and decrease if the rate is above 1.6.
What do Coffey et al. find? The results for past data from the UN World Population Prospects is summarised in Figure 3 from the paper:
Notice that for most levels of the total fertility rate, the point estimate of the change (growth) in the rate is negative. The most charitable interpretation of these results is that maybe there is some weak evidence for a cross-over at a total fertility rate of between the 1.25-1.35 bin and the 1.35-1.45 bin. However, none of the estimates below the 1.45-1.55 bin are statistically significantly different from zero, and the point estimates at the lowest total fertility rates are negative.
Moving onto data from the Human Fertility Database, the results are summarised in Figure 4 from the paper:
In this case, there is no evidence to support a stabilisation of cohort total fertility rates in these data. All point estimates are negative, and all of those from the 1.45-1.55 bin and above, are statistically significantly below zero. The results for Japanese prefectures since 2010, US states since 2010, and Indian districts (based on data from the Demographic and Health Survey 2019-2021) all similarly show negative and statistically significant change in total fertility rates across almost all levels of observed total fertility rates (the one exception is the 1.05-1.15 bin for Japanese prefectures, but that result is positive but statistically insignificant).
Taken altogether, these results demonstrate that there is no evidence that declining fertility rates will reverse course, at least not on average across countries, or across subnational areas in the three countries Coffey et al. looked at. There isn't even any evidence that total fertility rates will stabilise, at least not at the levels that have been observed so far.
Low and declining total fertility rates are the norm across developed countries, and increasingly in developing countries as well. They aren't returning to replacement levels. That doesn't mean that fertility rates will decline indefinitely, but it does mean that assuming they will stabilise seems unlikely to be borne out. So, policymakers might be better off planning for continuing low fertility, rather than blaming pet ownership and waiting for a rebound.
[HT: Marginal Revolution]
Read more:
- The pandemic 'baby bust' in other countries
- Cohort effects and the downturn in US fertility since the Great Recession
- The new economics of fertility
- The economics of the falling total fertility rate in New Zealand
- The economics of fertility in high-income countries
- Can fertility return to replacement levels?
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