Population Change and Economic Development: Case Studies and Reflections on the Ethiopian Demographic Transition

Abstract

While population growth has a large negative effect on per capita income growth, this effect is counteracted by large positive effect from growth in the share of the population that is economically active. Thus, the effect of population growth on economic development depends largely on the proportions of the working age and the policy mixes used to encourage people to work, save and invest.    Accordingly, this paper assesses the experiences of representative countries in the world with respect to their population change, policy mixes used and how these impact on their economic developments. The paper is organized into four sections. The first section assesses how population change affects economic developments followed by section 2 presenting selected countries’ case studies to see how their demographic transitions have been proceeding and what policy mixes was used to reap the demographic dividends that the age structure offers.   The third section deals with the discussion of possible lessons learned from those case studies that Ethiopia may consider as benchmarking. The fourth section examines the Ethiopian demographic transitions, the associated policy mixes being implemented and apparent policy effects. The final section concludes the paper.