Demographic Transitions and Population Momentum

The first demographic transition is the shift from high to low birth and death rates as a country develops, the second demographic transition describes the further fall of fertility below replacement level in wealthy societies, and population momentum is the tendency of a population to keep growing for decades after fertility drops to replacement level because it has a large share of young people. In brief: replacement-level fertility is about 2.1 children per woman. A country with a young age structure keeps adding people even at replacement fertility, because a large generation of young people is entering childbearing age. Population momentum explains why world population is still growing although global fertility has fallen to about 2.3 births per woman.

These ideas help to explain why populations change slowly and why policy effects take generations to appear. This guide explains the first and second demographic transitions, population momentum and its calculation, the demographic dividend, compares the transitions in a table, works through examples, outlines the history and corrects common mistakes.

What is the first demographic transition?

The first transition, described by the demographic transition model, takes a society from high birth and death rates, through falling death rates and rapid growth, to low birth and death rates. Causes include improvements in health, nutrition and sanitation, followed by urbanization, education (especially of girls), access to contraception, and lower child mortality, which together reduce the number of children that families want. It occurred in Europe from the 18th and 19th centuries and later in Asia, Latin America and parts of Africa, often faster than in Europe. Fertility is falling in nearly all regions: the world’s total fertility rate (TFR) fell from about 5 children per woman in the early 1960s to about 2.3 in recent years, and in more than half of all countries, it is now below the replacement level.

What is the second demographic transition?

The Dutch demographers Dirk van de Kaa and Ron Lesthaeghe described the second demographic transition in 1986 from the experience of Europe after the 1960s. In this phase, fertility falls below replacement not because of poverty or the need to limit family size, but because of changes in values and lifestyles: greater emphasis on individual autonomy and self-fulfillment, education and careers for women, later marriage, more cohabitation, more people having no children or just one, and widespread effective contraception. It is also influenced by the cost of housing and childcare and by uncertainty about the future. Examples include Italy, Spain, Germany, Japan, South Korea and China. South Korea has had a TFR well below 1, among the lowest in the world.

Below-replacement fertility leads, in the long term, to a shrinking and aging population unless offset by immigration. Some countries (France, the Nordic states) have kept fertility relatively close to replacement with support for working parents, although in recent years many have also seen a fall. The idea is debated: critics say that it describes mostly Western or East Asian trends and that economic factors also play a large role.

What is population momentum?

When a population has had high fertility for a long time, it has many children and young adults. Even if each woman now has only enough children to replace herself and her partner, the large number of young women entering the childbearing ages produces more births than the number of deaths among older people, so the population keeps growing for several decades before stabilizing. This is population momentum. The size of the effect is described by the momentum factor, the ratio between the eventual stationary population and the current population, assuming that fertility drops to replacement level at once and stays there. A factor of 1.3 means that the population will end up 30% larger than it is today.

Momentum is large in countries with a very young population, such as Nigeria, Niger and Pakistan, and small or even less than 1 in aging countries. It is the main reason why the world’s population is expected to keep growing for decades, while fertility is falling. The opposite effect, negative momentum, occurs in populations with a small base of young women, in which a return to replacement fertility would still lead to a decline for some time. Population policy cannot change this quickly: reducing the birth rate today has a small effect on population size over the next 20 to 30 years.

What is the demographic dividend?

As fertility falls, the share of children in the population shrinks, and for a time, the working-age population (15–64) is large compared with the young and the elderly, so the dependency ratio is low. This can provide a demographic dividend, an opportunity for faster economic growth if there are enough jobs, good education and health and savings and investment. The East Asian “tigers” benefited in this way in the late 20th century. If jobs are lacking, a large youth population can lead to unemployment and unrest instead. After some decades, the dividend ends as the large working-age group ages and the dependency ratio rises again, which is why the dividend is also called a “window of opportunity.”

The transitions compared

Worked example: replacement and momentum

The values are hypothetical and illustrate the arithmetic.

1. Replacement level: to replace two parents, each woman must have about 2 children, and slightly more because some girls die before childbearing age and slightly more boys than girls are born (105 boys per 100 girls). The result is a TFR of about 2.1 in countries with low mortality.
2. Momentum factor: a country has 50 million people and a momentum factor of 1.4. If fertility reaches replacement level immediately, the eventual stationary population is 50 × 1.4 = 70 million.
3. Delay in the fertility fall: the longer fertility stays above replacement level, the larger the population is by the time it falls. If the 50 million people grow by 1.5% a year for 15 years, the population becomes 50 × 1.015¹⁵ = 50 × 1.25 = 62.5 million, and momentum then adds further growth on top of this larger base.
4. Births and deaths in a young population: a population of 100 million has a crude birth rate of 20 and a crude death rate of 6 per 1,000. Natural growth is (20 − 6) ÷ 10 = 1.4% a year, even if the TFR has already fallen to 2.1, because so many young women are entering the childbearing ages.
5. Negative momentum: a country with 40 million people and a momentum factor of 0.9 will shrink to 40 × 0.9 = 36 million, even if fertility rises to 2.1 immediately.
6. Dependency ratio: in a country where 30% of people are aged 0–14, 62% are aged 15–64 and 8% are 65 or older, the total dependency ratio is (30 + 8) ÷ 62 × 100 = 61. After fertility falls and the shares become 22%, 68% and 10%, it is (22 + 10) ÷ 68 × 100 = 47, which creates the window of the demographic dividend.

How did these ideas develop?

Warren Thompson (1929) and Frank Notestein (1945) formulated the idea of the demographic transition. The concept of population momentum was developed in the 1960s and 1970s by demographers such as Nathan Keyfitz, who showed how age structure affects future growth. Van de Kaa and Lesthaeghe proposed the second demographic transition in 1986. In the 1990s, David Bloom and colleagues described the demographic dividend in studies of East Asia. Today, the UN Population Division publishes projections which show that global population is expected to peak in the 2080s at roughly 10 billion, followed by a possible decline, although such long-term forecasts are uncertain.

Which mistakes are common?

Mistake 1: Thinking that population stops growing when fertility reaches 2.1

Growth continues for decades because of the age structure. Momentum can add tens of percent to the population.

Mistake 2: Confusing replacement fertility with a fertility of exactly 2

Replacement level is slightly above 2 because of child mortality and the sex ratio at birth, and it is higher in countries with higher mortality.

Mistake 3: Treating the demographic dividend as automatic

The dividend requires jobs, health care, education and good institutions. Without them, a large youth population is a challenge.

Mistake 4: Assuming that all countries will follow Europe’s second transition

Fertility may fall below replacement for different reasons, and some countries have had a fall without the change in values described by the theory.