Journal of Economic Growth

, Volume 17, Issue 4, pp 357–385 | Cite as

The long-run determinants of fertility: one century of demographic change 1900–1999

  • Dierk Herzer
  • Holger Strulik
  • Sebastian Vollmer
Open Access


We examine the long-run relationship between fertility, mortality, and income using panel cointegration techniques and the available data for the last century. Our main result is that mortality changes and growth of income contributed to the fertility transition. The fertility reduction triggered by falling mortality, however, is not enough to overcompensate the positive effect of falling mortality on population growth. This means that growth of income per capita is essential to explain the observed secular decline of population growth. These results are robust to alternative estimation methods, potential outliers, sample selection, different measures of mortality, the sample period, the inclusion of education as an explanatory variable, and the use of different data sets. In addition, our causality tests suggest that fertility changes are both cause and consequence of economic development.


Fertility Mortality Economic development Panel cointegration 

JEL Classification

J1 J13 C23 



The authors’ would like to thank David Reher for sharing the data. The authors’ thank David Canning, Jesus Crespo Cuaresma, Carl-Johan Dalgaard, Michael Funke, six anonymous referees, and the editor, Oded Galor, for useful comments and suggestions.

Open Access

This article is distributed under the terms of the Creative Commons Attribution License which permits any use, distribution, and reproduction in any medium, provided the original author(s) and the source are credited.


  1. Acemoglu D., Johnson S. (2007) Disease and development: The effect of life-expectancy on economic growth. Journal of Political Economy 115: 925–985CrossRefGoogle Scholar
  2. Ahituv A. (2001) Be fruitful or multiply: On the interplay between fertility and economic development. Journal of Population Economics 14: 51–71CrossRefGoogle Scholar
  3. Angeles L. (2010) Demographic transitions: Analyzing the effects of mortality on fertility. Journal of Population Economics 23: 99–120CrossRefGoogle Scholar
  4. Ashraf Q., Galor O. (2011) Dynamics and stagnation in the Malthusian epoch. American Economic Review 101: 2003–2041CrossRefGoogle Scholar
  5. Arellano M., Bond S. R. (1991) Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies 58: 277–297CrossRefGoogle Scholar
  6. Baltagi B. H., Griffin J. M. (1997) Pooled estimators vs. their heterogeneous counterparts in the context of dynamic demand for gasoline. Journal of Econometrics 77: 303–327CrossRefGoogle Scholar
  7. Baltagi B., Kao C. (2000) Nonstationary panels, cointegration in panels, and dynamic panels: A survey. Advances in Econometrics 15: 7–52CrossRefGoogle Scholar
  8. Banerjee A. (1999) Panel data unit roots and cointegration: An overview. Oxford Bulletin of Economics and Statistics 61: 607–629CrossRefGoogle Scholar
  9. Banerjee, A., Eberhardt, M., Reade, J.J. (2010). Panel estimation for worriers. Discussion Paper No. 514, Department of Economics, University of Oxford, Oxford.Google Scholar
  10. Becker G. S. (1965) A theory of the allocation of time. Economic Journal 75: 493–517CrossRefGoogle Scholar
  11. Becker G. S., Lewis H. G. (1973) On the interaction between the quantity and quality of children. Journal of Political Economy 8: 279–288CrossRefGoogle Scholar
  12. Blundell R., Bond S. (1998) Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics 87: 115–143CrossRefGoogle Scholar
  13. Brander J. A., Dowrick S. (1994) The role of fertility and population in economic growth. Journal of Population Economics 7: 1–25CrossRefGoogle Scholar
  14. Breitung J. (2005) A parametric approach to the estimation of cointegrating vectors in panel data. Econometric Reviews 24: 151–173CrossRefGoogle Scholar
  15. Bun M. J. G., Windmeijer F. (2010) The weak instrument problem of the system GMM estimator in dynamic panel data models. Econometrics Journal 13: 95–126CrossRefGoogle Scholar
  16. Cervellati, M., Sunde, U. (2007). Human capital, mortality and fertility: A unified theory of the economic and demographic transition. IZA Discussion Paper 2905.Google Scholar
  17. Cervellati M., Sunde U. (2011) Life expectancy and economic growth: The role of the demographic transition. Journal of Economic Growth 16: 99–133CrossRefGoogle Scholar
  18. Chambers, M. J. (2001). Cointegration and sampling frequency. Discussion Paper No. 531, Department of Economics, University of Essex.Google Scholar
  19. Chambers M. J. (2003) The asymptotic efficiency of cointegration estimators under temporal aggregation. Econometric Theory 19: 49–77CrossRefGoogle Scholar
  20. Cleland J. (2001) The effects of improved survival on fertility: A reassessment. Population and Development Review 27(Supplement): 60–92Google Scholar
  21. Doepke M. (2004) Accounting for fertility decline during the transition to growth. Journal of Economic Growth 9: 347–383CrossRefGoogle Scholar
  22. Doepke M. (2005) Child mortality and fertility decline: Does the Barro–Becker model fit the facts?. Journal of Population Economics 18: 337–366CrossRefGoogle Scholar
  23. Eckstein Z., Schultz T. P., Wolpin K. I. (1984) Short-run fluctuations in fertility and mortality in pre-industrial Sweden. European Economic Review 26: 295–317CrossRefGoogle Scholar
  24. Eckstein Z., Mira P., Wolpin K. (1999) A quantitative analysis of swedisch fertility dynamics. Review of Economic Dynamics 2: 137–165CrossRefGoogle Scholar
  25. Entorf H. (1997) Random walks with drifts: Nonsense regression and spurious fixed-effects estimation. Journal of Econometrics 80: 287–296CrossRefGoogle Scholar
  26. Fisher R. A. (1932) Statistical methods for research workers. Oliver and Boyd, EdinburghGoogle Scholar
  27. Galloway P. R. (1988) Basic patterns in annual variations in fertility, nuptiality, mortality, and prices in pre-industrial Europe. Population Studies 42: 275–303CrossRefGoogle Scholar
  28. Galor, O. (2005). From stagnation to growth: Unified growth theory. In: P. Aghion & S. Durlauf Handbook of economic growth. Amsterdam: North-Holland.Google Scholar
  29. Galor O., Weil D. N. (1996) The gender gap, fertility, and growth. American Economic Review 86: 374–387Google Scholar
  30. Galor O., Weil D. N. (2000) Population, technology and growth: From Malthusian stagnation to the demographic transition and beyond. American Economic Review 90: 806–828CrossRefGoogle Scholar
  31. Galor O., Moav O. (2002) Natural selection and the origin of economic growth. Quarterly Journal of Economics 117: 1133–1191CrossRefGoogle Scholar
  32. Galor O. (2011) Unified growth theory. Princeton University Press, PrincetonGoogle Scholar
  33. Granger C. W. J. (1990) Aggregation of time-series variables: A survey. In: Barker T., Pesaran M. H. (eds) Disaggregation in econometric modelling. Routledge, London, pp 17–34Google Scholar
  34. Granger C. W. J., Newbold P. (1974) Spurious regressions in econometrics. Journal of Econometrics 2: 111–120CrossRefGoogle Scholar
  35. Greenwood J., Seshadri A., Vandenbroucke G. (2005) The baby boom and baby bust. American Economic Review 95: 183–207CrossRefGoogle Scholar
  36. Hakkio C. S., Rush M. (1991) Cointegration: How short is the long run?. Journal of International Money and Finance 10: 571–581CrossRefGoogle Scholar
  37. Hall S. G., Milne A. (1994) The relevance of p-star analysis to UK monetary policy. Economic Journal 104: 597–604CrossRefGoogle Scholar
  38. Hansen, B. E. (1992). Tests for parameter instability in regressions with I(1) processes. Journal of Business and Economic Statistics, 10, 321–35.Google Scholar
  39. Hazan M., Berdugo B. (2002) Child labor, fertility, and economic growth. Economic Journal 112: 810–828CrossRefGoogle Scholar
  40. Hendry D. F. (1995) Dynamic econometrics. Oxford University Press, OxfordCrossRefGoogle Scholar
  41. Herzer D. (2008) The long-run relationship between outward FDI and domestic output: Evidence from panel data. Economics Letters 100: 146–149CrossRefGoogle Scholar
  42. Herzer, D., Strulik, H., Vollmer, S. (2010). The Long-run determinants of fertility: One century of demographic change 1900–1999. PGDA Working Paper No. 63, Harvard University, Cambridge.Google Scholar
  43. Holly S., Pesaran M. H., Yamagata T. (2010) A spatio-temporal model of house prices in the US. Journal of Econometrics 158: 160–173CrossRefGoogle Scholar
  44. Im K. S., Pesaran M. H., Shin Y. (2003) Testing for unit roots in heterogeneous panels. Journal of Econometrics 115: 53–74CrossRefGoogle Scholar
  45. Johansen S. (1988) Statistical analysis of cointegrating vectors. Journal of Economic Dynamics and Control 12: 231–254CrossRefGoogle Scholar
  46. Johansen S. (2000) Modelling of cointegration in the vector autoregressive model. Economic Modeling 17: 359–373CrossRefGoogle Scholar
  47. Jones C. I. (1995) R&D-based models of economic growth. Journal of Political Economy 103: 759–784CrossRefGoogle Scholar
  48. Jones C. I. (2003) Population and ideas: A theory of endogenous growth. In: Aghion P., Frydman R., Stiglitz J., Woodford M. (eds) Knowledge, information and expectations in modern macroeconomics. Princeton University Press, Princeton, New Jersey, pp 498–521Google Scholar
  49. Juselius K. (2001) European integration and monetary transmission mechanisms: The case of Italy. Journal of Applied Econometrics 16: 314–358CrossRefGoogle Scholar
  50. Kalemli-Ozcan S. (2002) Does the mortality decline promote economic growth. Journal of Economic Growth 7: 411–439CrossRefGoogle Scholar
  51. Kao C. (1999) Spurious regression and residual-based tests for cointegration in panel data. Journal of Econometrics 90: 1–44CrossRefGoogle Scholar
  52. Kao C., Chiang M. H. (2000) On the estimation and inference of a cointegrated regression in panel data. Advances in Econometrics 15: 179–222CrossRefGoogle Scholar
  53. Kapetanios G., Pesaran M. H., Yamagata T (2011) Panels with nonstationary multifactor error structures. Journal of Econometrics 160: 326–348CrossRefGoogle Scholar
  54. Kirk D. (1996) Demographic transition theory. Population Studies 50: 361–387CrossRefGoogle Scholar
  55. Kögel T., Prskawetz A. (2001) Agricultural productivity growth and escape from the Malthusian trap. Journal of Economic Growth 6: 337–357CrossRefGoogle Scholar
  56. Lahiri K., Mamingi N. (1995) Power versus frequency of observation another view. Economics Letters 49: 121–124CrossRefGoogle Scholar
  57. Larsson R., Lyhagen J., Lthegren M. (2001) Likelihood-based cointegration tests in heterogeneous panels. Econometrics Journal 4: 109–142CrossRefGoogle Scholar
  58. Lee R., Anderson M. (2002) Malthus in state space: Macro economic-demographic relations in english history, 1540 to 1840. Journal of Population Economics 15: 195–220CrossRefGoogle Scholar
  59. Lettau M., Ludvigson S. C. (2004) Understanding trend and cycle in asset values: Reevaluating the wealth effect on consumption. American Economic Review 94: 276–299CrossRefGoogle Scholar
  60. Levin A., Lin C. F., Chu C. S. J. (2002) Unit root test in panel data: Asymptotic and finite-sample properties. Journal of Econometrics 108: 1–24CrossRefGoogle Scholar
  61. Lorentzen P., Millan J., Wacziarg R. (2008) Death and development. Journal of Economic Growth 13: 81–124CrossRefGoogle Scholar
  62. Lütkepohl H. (2007) General-to-specific or specific-to-general modelling? An opinion on current econometric terminology. Journal of Econometrics 136: 319–324CrossRefGoogle Scholar
  63. Lütkepohl H., Reimers H. E. (1992) Impulse response analysis of cointegrated systems. Journal of Economic Dynamics and Control 16: 53–78CrossRefGoogle Scholar
  64. Lütkepohl H., Wolters J. (1998) A money demand system for German M3. Empirical Economics 23: 371–386CrossRefGoogle Scholar
  65. Lütkepohl H., Wolters J. (2003) Transmission of German monetary policy in the pre-Euro period. Macroeconomic Dynamics 7: 711–733CrossRefGoogle Scholar
  66. Maddison A. (2003) The world economy: Historical statistics. OECD, ParisGoogle Scholar
  67. Moav O. (2005) Cheap children and the persistence of poverty. Economic Journal 115: 88–110CrossRefGoogle Scholar
  68. Morrisson C., Murtin F. (2009) The century of education. Journal of Human Capital 3: 1–42CrossRefGoogle Scholar
  69. Murtin, F. (2012). Long-term determinants of the demographic transition: 1870–2000. Review of Economics and Statistics (forthcoming).Google Scholar
  70. Neher P. A. (1971) Peasants, procreation, and pensions. American Economic Review 61: 380–389Google Scholar
  71. Nicolini E. (2007) Was Malthus right? A VAR analysis of economic and demographic interactions in pre-industrial England. European Review of Economic History 11: 99–121CrossRefGoogle Scholar
  72. Pedroni P. (1999) Critical values for cointegration tests in heterogeneous panels with multiple regressors. Oxford Bulletin of Economics and Statistics 61: 653–670CrossRefGoogle Scholar
  73. Pedroni P. (2001) Purchasing power parity tests in cointegrated panels. Review of Economics and Statistics 83: 727–731CrossRefGoogle Scholar
  74. Pedroni P. (2004) Panel cointegration: Asymptotic and finite sample properties of pooled time series tests with an application to the PPP hypothesis. Econometric Theory 20: 597–625CrossRefGoogle Scholar
  75. Pedroni P. (2007) Social capital, barriers to production and capital shares: Implications for the importance of parameter heterogeneity from a nonstationary panel approach. Journal of Applied Econometrics 22: 429–451CrossRefGoogle Scholar
  76. Pesaran M. H. (2006) Estimation and inference in large heterogeneous panels with a multifactor error structure. Econometrica 74: 967–1012CrossRefGoogle Scholar
  77. Pesaran M. H. (2007) A simple panel unit root test in the presence of cross-section dependence. Journal of Applied Econometrics 22: 265–312CrossRefGoogle Scholar
  78. Pesaran M. H., Shin Y. (1998) Generalized impulse response analysis in linear multivariate models. Economics Letters 58: 17–29CrossRefGoogle Scholar
  79. Phillips P. C. B, Hansen B. E. (1990) Statistical inference in instrumental variables regression with I(1) processes. Review of Economic Studies 57: 99–125CrossRefGoogle Scholar
  80. Reher D. S. (2004) The demographic transition revisited as a global process. Population Space and Place 10: 19–41CrossRefGoogle Scholar
  81. Reinsel G. C., Ahn S. K. (1992) Vector autoregressive models with unit roots and reduced rank structure: Estimation, likelihood ratio test and forecasting. Journal of Time Series Analysis 13: 353–375CrossRefGoogle Scholar
  82. Roodman D. (2009) A note on the theme of too many instruments. Oxford Bulletin of Economics and Statistics 71: 135–158CrossRefGoogle Scholar
  83. Romer P. M. (1990) Endogenous technological change. Journal of Political Economy 98: S71–S102CrossRefGoogle Scholar
  84. Sah R. K. (1991) The effects of child mortality changes on fertility choice and parental welfare. Journal of Political Economy 99: 582–606CrossRefGoogle Scholar
  85. Shiller R. J., Perron P. (1985) Testing the random walk hypothesis: Power versus frequency of observation. Economics Letters 18: 381–386CrossRefGoogle Scholar
  86. Schultz T.P. (1997) Demand for children in low income countries. In: M. R. Rosenzweig, & O. Stark (Eds.), Handbook of population and family economics (Vol. 1, pp. 349–430). Amsterdam: North Holland Pub. Co.Google Scholar
  87. Soares R. R (2005) Mortality reductions, educational attainment, and fertility choice. American Economic Review 95: 580–601CrossRefGoogle Scholar
  88. Stock J. H., Watson M. W. (1988) Testing for common trends. Journal of the American Statistical Association 83: 1097–1107CrossRefGoogle Scholar
  89. Stock J. H., Watson M. W. (1993) A simple estimator of cointegrating vectors in higher-order integrated systems. Econometrica 61: 783–820CrossRefGoogle Scholar
  90. Strulik H. (2003) Mortality, the trade-off between child quality and quantity, and demo-economic development. Metroeconomica 54: 499–520CrossRefGoogle Scholar
  91. Strulik H. (2004) Child mortality, child labour and economic development. Economic Journal 114: 547–568CrossRefGoogle Scholar
  92. Strulik H. (2008) Geography, health, and the pace of demo-economic development. Journal of Development Economics 86: 61–75CrossRefGoogle Scholar
  93. Strulik H., Weisdorf J. (2008) Population, food, and knowledge: A simple unified growth theory. Journal of Economic Growth 13: 169–194CrossRefGoogle Scholar
  94. Strulik, H., Weisdorf, J. (2012). How child costs and survival shaped the industrial revolution and the demographic transition. Macroeconomic Dynamics (forthcoming).Google Scholar
  95. Urbain J. P. (1995) Partial versus full system modeling of cointegrated systems: An empirical illustration. Journal of Econometrics 69: 177–210CrossRefGoogle Scholar
  96. Wagner M., Hlouskova K. (2010) The performance of panel cointegration methods: Results from a large scale simulation study. Econometric Reviews 29: 182–223CrossRefGoogle Scholar
  97. Wang P., Yip C. K., Scotese C. A. (1994) Fertility choice and economic growth: Theory and evidence. The Review of Economics and Statistics 76: 255–266CrossRefGoogle Scholar
  98. Westerlund J. (2007) Testing for error correction in panel data. Oxford Bulletin of Economics and Statistics 69: 709–748CrossRefGoogle Scholar

Copyright information

© The Author(s) 2012

Authors and Affiliations

  • Dierk Herzer
    • 1
  • Holger Strulik
    • 2
  • Sebastian Vollmer
    • 2
    • 3
  1. 1.Department of EconomicsHelmut-Schmidt-University HamburgHamburgGermany
  2. 2.Department of EconomicsUniversity of GöttingenGöttingenGermany
  3. 3.Department of Global Health and PopulationHarvard School of Public HealthBostonUSA

Personalised recommendations