Demographic Dividends in Africa: Reconciling the Evidence With a Mixed-Decomposition Approach

Parfait Eloundou-Enyegue, Cornell University
Michel Tenikue, Luxembourg Institute of Socio-Economic Research (LISER)
Sarah Giroux , Cornell University

The demographic dividend offers a strong theoretical argument for the effects of fertility transitions on economic development. Yet, empirical consensus on the magnitude of dividends remains limited by 1) the diversity in methods and frameworks used and 2) a scarcity of detailed data. We address these limitations in two ways. One is by conceptually distinguishing between the ‘mechanical’ versus ‘substantive’ components of the dividend. A second is through methodological integration of two analytic traditions –regression and accounting methods. Because regressions capture substantive influences while accounting methods capture mechanical influences, their integration -in the form of a mixed decomposition- gives a fuller picture. The method can be applied under rich data environments but also in more limited data environments. Its application to African settings circa 1980-2010 suggests the that for most countries where fertility fell a mechanical dividend that accounted for anywhere between 12% and 38% of the country’s economic growth.

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 Presented in Session 3. Population, Development, & the Environment; Data & Methods; Applied Demography