Population, Poverty and Development

Population, Poverty and
Review
and Research
Gaps JEREMY B. CERVANTES
Development:
MPA-HTU
Outline
Population and Development: A
comparison of Philippines and
Thailand
Population and Poverty
Philippine demographic trends
Philippine poverty alleviation record
Links
Evidence
Implications for Policy
Research Gaps
Population & Development: Philippines & Thailand - 1/2

Fig 2. Per Capita GDP, Real US$ (1995=100)
Fig 3. Population Size, 1960-2000
Source: World Bank, World Development Indicators 2002
Source: UN World Population Prospects, 2000 Rev.
3,500
80
3,000
70
60
2,500
Philippines
2,000
Thailand
1,500
50
1,000
20
500
10
0
1960 1965 1970 1975 1980 1985 1990 1995 2000
Fig 5. Infant Mortality, 1960-65 to 2000-05
Fig 4. Total Fertility Rate, 1960-65 to 2000-2005

8.00
120
7.00
100
6.00
Thailand
Thailand
30
1960 1965 1970 1975 1980 1985 1990 1995 2000
Philippines
Philippines
40
80
5.00
4.00
60
3.00
40
2.00
Philippines
Thailand
20
1.00
0.00
1960-65 1970-75 1980-85 1990-95 1995-00 2000-05
1960-65 1970-75 1980-85 1990-95 1995-00 2000-05
Population & Development: Philippines & Thailand - 2/2

Fig 7. Gross Domestic Savings as % of GDP, 1960-2000
Fig 6. Youth and Old Dependency Ratios, 1960-2000
1.00
0.90
0.80
40
35
0.70
0.60
0.50
0.40
0.30
Phil., Youth
Thai., Youth
Phil., Old
Thai., Old
30
25
Philippines
20
Thailand
15
10
0.20
0.10
0.00
5
0
1960 1965 1970 1975 1980 1985 1990 1995 2000
1960 1965 1970 1975 1980 1985 1990 1995 2000
Fig 8. Gross Capital Formation as % of GDP, 1960-2000
Fig 10. Gross Enrollment Rate, Sec. & Ter., 1970-1998
45
100
40
35
90
80
30
70
Philippines
25
Thailand
20
Phil, Sec.
60
50
Thai, Sec.
Phil, Ter.
40
15
30
10
5
20
10
0
1960 1965 1970 1975 1980 1985 1990 1995 2000
Thai, Ter.
1970 1975 1980 1985 1990 1995 1998
Population and Sustainable Development Framework

Population
Size
Structure
Distribution
Fertility
Mortality
Migration
Production
Production/
Employment
Productive
Capacity:
Natural Resources and
Environment
Physical Capital
Human Resources
Development
Goods and
Services
Capabilities/
Well being
Longer life
To achieve desired
fertility
Others
Review of demographic developments

Slow fertility decline; slower than most countries
in the region (Table 1)
Average performer in mortality (Table 2)
Continued high population growth; higher than
most countries in the region
Implications:
Expect extended years of high youth dependency
Demographic onus rather than demographic
bonus like East Asia Countries
Fertility and Mortality in Selected ASEAN

Countries
TFR of Selected Asean Countries, 1960-2000
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
1960-65
1970-75
Phil
1980-85
Thai
Viet
1990-95
Ind
1995-00
Mal
IMR of Selected ASEAN Countries, 1960-2000

200
150
100
50
0
1960-65
1970-75
Phil
1980-85
Thai
Viet
1990-95
Ind
Mal
1995-00
Review of poverty alleviation record

Modest gains from 44.2% in 1985 to 33.7% in 2000
Number of poor people increased from 4.6 million
in 1985 to 5.14 million in 2000
Gains are only clear in urban areas (declined by 14
compared to only 4 percentage points in rural
areas between 1985-2000)
Inequality has not improved:
Share of poorest quintile: 4.8% (1985) 4.7%
(2000)
Share of richest quintile: 51.2% (1985) 54.8%
(2000)
Gini coefficient: 0.47 (1985) 0.51 (2000)
Poverty and Inequality, 19852000

60
50
40
30
20
10
Millions
Poverty Incidence and No. of Poor, 1985-2000
Phil
Urban
Rural
No of Poor
0
1985
1988
1991
1994
1997
2000
Figure 1. GINI Ratios, 1975-2000

0.53
0.52
0.51
0.5
0.49
0.48
0.47
0.46
0.45
0.44
0.52
0.51
0.49
0.47
1985
0.47
1988
0.47
1991
1994
1997
2000
Family Size and Poverty
An empirical regularity that poverty incidence is higher

the larger the family size
Poverty Incidence by Family Size
Family Size
National
1
2
3
4
5
6
7
8
9 or more
1985
1988
Poverty Incidence
1991
1994
1997
2000
44.2
40.2
39.9
35.5
31.8
33.7
19.0
20.0
26.6
36.4
42.9
48.8
55.3
59.8
59.9
12.8
18.4
23.2
31.6
38.9
45.9
54.0
57.2
59.0
12.7
21.8
22.9
30.1
38.3
46.3
52.3
59.2
60.0
14.9
19.0
20.7
25.3
31.8
40.8
47.1
55.3
56.6
9.8
14.3
17.8
23.7
30.4
38.2
45.3
50.0
52.6
9.8
15.7
18.6
23.8
31.1
40.5
48.7
54.9
57.3
Source of basic data: Family Income and Expenditures Surveys, 1985-2000, NSO
Population and poverty links

Growth Channel: Does demographic change
(change in population growth, fertility, mortality,
age structure, etc.) affects changes in the level
and growth of average attainable well-being per
person?
Distribution Channel: Does demographic
change affects the distribution of income given
attainable well-being per person?
Conversion Channel: Does demographic change
affects the conversion of attainable welfare per
person into actual well-being per person?
Evidence on the growth channel

Demographic changes (decline in population growth,
fertility, mortality and changing age distribution) have
sizeable impacts on economic growth; account for
about half of recorded economic growth in Southeast
Asia, one third in East Asia
Fertility and mortality effects are offsetting; mortality
decline stimulates growth, rise in fertility attenuates
growth; this is the primary reason for the limited effect
in analysis that focus on population growth
In the Philippines, economic growth contributes bigger
proportion in reduction of poverty; in cross-country
analysis it contributes about one half
Evidence on the distribution channel

High fertility skews the distribution of income
against the poor in cross-country analysis; in the
Philippines, there is still no direct evidence but
indications are pointing to the same direction
given the limited employment opportunities
generated and the rapidly growing labor force
There is limited evidence on the dependency
burden effect via the dilution effect; this effect
appears to be not very strong
On the acquisition effect, there are mixed results
on the impact of an additional child on labor force
participation of fathers but this leads to a decline
of mothers labor time and an increase in her
home time
Evidence on the conversion channel

Doubts on whether poor families can freely
choose their family size given poorer access to FP
services, particularly for the Philippines
There are evidence on both sides of the
economies of scale argument
Clear deleterious effects of large family on
investments in human capital
Clear increase in vulnerability with larger family
size
Family planning practice by

socioeconomic class
Source
Poor
C ontraceptive prevalence
FPS 2000\a
Modern
Traditional
Any method
N on-Poor
Total
26.3
13.9
40.1
35.0
15.1
50.1
32.3
14.7
47.0
40.5
33.7
46.2
37.0
44.1
35.8
A ccess to family planning services

APIS 1998\b
85.2
APIS 1999\b
89.1
90.7
93.1
88.7
91.7
APIS 1998\b
APIS 1999\b
\a - socioeconomic status is based on a score derived from questions

about housing convenience/durable goods
\b - socioeconomic status based on incom e deciles: poor = lowest
40%; Non-poor=highest 60%
FPS - Family Planning Survey
APIS - Annual Poverty Indicators Survey
Population Growth and Human Capital

Accumulation Household Level 1/2
Survey of developing country evidence
King (1987)
Children in large families perform less well in school
Children in large families have poorer health, lower
survival probabilities, and are less developed
physically
Lloyd (1994)
Resource dilution with each child getting smaller
share of family resources including income, time
and maternal nutrition
Diminished access to public resources, such as
health and education
Unequal distribution of resources among siblings
Population Growth and Human Capital

Accumulation Household Level 2/2
Evidence from Philippine data
High fertility negatively affects school
participation of older children (13-17 years old)
although it does not affect school participation
of younger children (7-12 years old) (Herrin
1983, Bauer and Racelis, 1992)
Large negative impact on boys (DeGraff et al.,
1993)
Expenditure per child is also negatively
affected (Bankosta and Evenson, 1978)
Family Size and Vulnerability
Using the 1997 FIES

and the 1998 and 1999
APIS, it was found that
46% of the family
remained to be nonpoor (N) while 22%
remained to be poor
(P) throughout the
period. Interestingly, as
one goes from
households who
remained to be poor to
households who
remained to be nonpoor, the family size
declines (Reyes, 2002).
Poverty, Vulnerability and

Family Size, 1997, 1998, 1999
Poverty
Group
Mean Family
Size
PPP
PPN
PNP
NPP
PNN
NNP
NPN
NNN
6.1
5.1
5.4
5.4
4.8
5.1
4.6
4.6
Philippines
5.0
P-Poor; N-Non-Poor
Sources of Basic Data: Run from the matched Public
Use Files of the 1997 Family Income and
Expenditures Survey, and the 1998 and 1999 Annual
Source: Reyes (2002), Table 32
Implications for policy

1/2
Demographics play an important role in poverty

alleviation; better control of fertility should be an
important component of poverty alleviation
While there maybe reasons why the poor have large
families, it will be difficult, particularly for the
Philippines, to sort which ones are due to lack of
control over fertility and which ones are due to
preferences; better control of fertility is needed to
clarify this
There are intergenerational impact of current fertility
primarily via lower investments in human capital this
is the main avenue of intergenerational transmission of
poverty; need for pro-active subsidy and better
targeting of public services, e.g. education and health,
which are in themselves investments with high social
returns apart from demographic concerns
Implications for policy

2/2
Importance of consistent economic growth wellestablished; still the primary strategy of

development for the Philippines; a conducive
economic environment is needed to translate
potential benefits from demographic changes
With globalization, lower fertility is needed to
benefit from opportunities at the aggregate and
household levels, and to lessen the vulnerability
of households to economic shocks
The question to ask: Is there enough reasons for
government to intervene in fertility decisions?; for
poor households does the with persuasion case
in Herrin (2002) apply?
Research Agenda Population,

Poverty and Development
Improve upon the current broad brush attribution
of the interaction between population and poverty
for the Philippines. There is a need to continue to
clarify the interactions, at the macro, community
and household levels in the Philippine context.
The objective is to find for more effective policy
handles
Poverty, fertility management and preferences
and its implications at the household level

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Population, Poverty and

Population & Development: Philippines & Thailand - 1/2

Fig 3. Population Size, 1960-2000

Source: World Bank, World Development Indicators 2002

Source: UN World Population Prospects, 2000 Rev.

Fig 5. Infant Mortality, 1960-65 to 2000-05

Fig 4. Total Fertility Rate, 1960-65 to 2000-2005

1960 1965 1970 1975 1980 1985 1990 1995 2000

1960-65 1970-75 1980-85 1990-95 1995-00 2000-05

Population & Development: Philippines & Thailand - 2/2

Fig 6. Youth and Old Dependency Ratios, 1960-2000

1960 1965 1970 1975 1980 1985 1990 1995 2000

Fig 8. Gross Capital Formation as % of GDP, 1960-2000

Fig 10. Gross Enrollment Rate, Sec. & Ter., 1970-1998

1970 1975 1980 1985 1990 1995 1998

Population and Sustainable Development Framework

Review of demographic developments

Fertility and Mortality in Selected ASEAN

IMR of Selected ASEAN Countries, 1960-2000

Review of poverty alleviation record

Poverty and Inequality, 19852000

Poverty Incidence and No. of Poor, 1985-2000

Figure 1. GINI Ratios, 1975-2000

Family Size and Poverty

An empirical regularity that poverty incidence is higher

Population and poverty links

Evidence on the growth channel

Evidence on the distribution channel

Evidence on the conversion channel

Family planning practice by

A ccess to family planning services

\a - socioeconomic status is based on a score derived from questions

Population Growth and Human Capital

Population Growth and Human Capital

Family Size and Vulnerability

Using the 1997 FIES

Poverty, Vulnerability and

Implications for policy

Demographics play an important role in poverty

Implications for policy

Importance of consistent economic growth wellestablished; still the primary strategy of

Research Agenda Population,

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