Cited by 64Family Dynamics and RelationshipsDemographic Trends and Gender PreferencesEconomic Growth and Productivity

The DOI matches its Crossref record; 264 of the 264 references it cites were found in a registry or an index; 46 of the 145 sources its claims cite were checked for support.

Fertility in High-Income Countries: Trends, Patterns, Determinants, and Consequences

Open access
Bloom, David E., Kuhn, Michael, Prettner, Klaus·2024·Annual Review of Economics

Abstract

High-income countries have generally experienced falling fertility in recent decades. In most of these countries, the total fertility rate is now below the level that implies a stable population in the long run. This has led to concerns among economists, policymakers, and the wider public about the economic consequences of low fertility and population decline. In this contribution, we aim to ( a ) describe the main determinants of low fertility in high-income countries, ( b ) assess its potential economic consequences, ( c ) discuss adjustment mechanisms for individuals and economies, ( d ) propose a simple economic framework to analyze the long-run economic impacts of low fertility, and ( e ) draw lessons for economic policymakers to react appropriately. While the economic challenges of low fertility are substantial, a thoughtful and consistent policy response can mitigate most of the adverse consequences.

Overview

AI snapshot

Written from the paper’s full text.

TL;DR

High-income countries have generally experienced falling fertility, with the OECD total fertility rate dropping from 3.29 children per woman in 1960 to 1.63 in 2019 and most countries now below replacement. The review argues that low fertility creates substantial economic challenges, but compensatory mechanisms and a coordinated policy mix can mitigate most adverse consequences.

Key findings

  • Across OECD countries, the total fertility rate fell from 3.29 children per woman in 1960 to 1.63 in 2019; all countries in Table 1 experienced declines, and except Israel (TFR 3.22 in 2019), 2019 TFRs were below the replacement rate of 2.1. The Republic of Korea had the lowest 2019 TFR at 0.91 and the largest secular decline at −5.04.
  • Fertility decline is attributed to multiple determinants: rising opportunity costs of childrearing, especially women’s earnings; quantity-quality trade-offs; family policies; uncertainty and old-age security motives; social norms; childlessness; internet and partnership changes; and post-Great Recession/COVID-19 dynamics.
  • Macroeconomic concerns include labor shortages, pressure on pay-as-you-go welfare systems, reduced innovation and entrepreneurship, lower consumption growth, and regional imbalances; compensatory mechanisms include demographic dividends, increased female employment, savings responses, human capital investment, and labor-saving technology.
  • The proposed semi-endogenous growth model with human capital and endogenous education/fertility choice yields Result 1: aggregate human capital growth decreases when fertility increases (and vice versa), and Result 2: a negative effect of population growth on economic growth. Policy implications stress that no single policy is a panacea; immigration, family-friendly policies, education and health investment, R&D, later retirement, and policy synergies are needed.

Methods

  • Design: literature review plus a simple theoretical extension of a semi-endogenous growth model with human capital and endogenous fertility and education choices.
  • Data/sample: OECD country total fertility rates for 1960, 2019, and 2021 from United Nations (2022) and World Bank (2023), presented in Table 1; narrative synthesis of cited empirical and theoretical literature.
  • Main analysis: descriptive comparison of TFR trends; review of determinants and macroeconomic consequences; derivation of model results linking fertility, human capital growth, and long-run economic growth.

Limitations

  • The paper states that its model deliberately switches off the reverse channel from income to fertility and focuses on the economic consequences of changing fertility choices; it captures mainly the quantity-quality trade-off as a long-run compensation mechanism, and many extensions are possible.
  • The paper notes unresolved evidence in the literature, including that the extent of male sperm-count effects remains unresolved, evidence on climate anxiety and voluntary childlessness is inconclusive, and the extent to which human capital improvements offset population aging or decline is unclear.
  • Evident from the text: as a review, it does not provide new empirical estimates; its quantitative claims rely on cited studies and a simple theoretical model rather than original causal identification.

Model-written summary. Check it against the paper before relying on it.

Integrity signals

Registry

Crossref · 10.1146/annurev-economics-081523-013750

Cites

264 of 264 references verified0 citation errors · 0 not checkable

Statistics

Nothing to recompute.

Verification

Claims the paper makes

40 Own interpretation · 32 Sources not found · 21 Partly supported · 16 No full text of the sources · 10 Supported so far · 9 No basis given · 8 Supported · 8 Not checked yet · 1 Own result · accuracy not yet measured

Show all 78 claims

  • It may state two separate claims as one. 51
  • The quote only partly states this claim. 1
  • Probably not a substantial claim. 24
67 of 67
  • The paper relies on this without support.

    Increases in tuition and in the rental prices of living spaces have reduced the ability of many families to bring up children in conditions that guarantee them a good childhood.

    “Increases in tuition and in the rental prices of living spaces have reduced the ability of many families to bring up children in conditions that guarantee them a good childhood.”
  • The paper relies on this without support.

    Changing social norms related to different dating habits, higher marriage ages, and smaller families have contributed to the decline in fertility.

    “Changing social norms related to different dating habits, higher marriage ages, and smaller families may all have contributed to the decline in fertility.”
  • The paper relies on this without support.

    Reductions in biological fecundity and in male sperm count are a plausible reason for low fertility.

    “reductions in biological fecundity and, in particular, in male sperm count that have been observed over recent years are another plausible reason for low fertility”
  • The paper relies on this without support.

    The advent of social media and dating platforms has changed the matching market as well as fertility choices and opportunities.

    “however, the advent of social media and dating platforms has also changed the matching market as well as fertility choices and opportunities.”
  • The paper relies on this without support.

    Many countries have to support their pay-as-you-go pension or healthcare systems with a substantial part of their tax revenues.

    “As a consequence, many countries have to support their pay-as-you-go pension or healthcare systems with a substantial part of their tax revenues.”
  • The authors state this as an assumption.

    Time t evolves discretely.

    “We assume that time t evolves discretely because including a realistic human capital accumulation process in the model is then straightforward.”
  • The authors state this as an assumption.

    The production side of the economy is the same as posited by Jones (1995), except that the knowledge production function features the human capital embodied in the scientific workforce instead of the number of scientists.

    “In so doing, we assume that the production side of the economy is the same as posited by Jones (1995), except that the knowledge production function features the human capital embodied in the scientific workforce instead of the number of scientists.”
  • The authors state this as an assumption.

    Households derive utility from consumption, the number of own children, and the education the children enjoy, with decreasing marginal effects.

    “On the consumption side, households derive utility from consumption ( c t ), from the number of own children ( nt ), and from the education the children enjoy ( e t ), reflecting intergenerational altruism. Utility is increasing in all of these arguments but with a decreasing marginal effect.”
  • The authors state this as an assumption.

    A hierarchy of needs holds according to which households prioritize first consumption, then procreation, and finally education, ensured if 1 > α > η > 0.

    “For meaningful results, a hierarchy of needs has to hold according to which households prioritize first consumption, then procreation, and finally education. This is ensured if 1 >α > η > 0.”
  • The authors state this as an assumption.

    The costs of children are modeled as forgone parental labor income due to time spent on childcare, and each child requires ψ units of parental time.

    “The wage rate is denoted by w t , and the costs of children are modeled as forgone parental labor income due to the time spent on childcare. Assuming that each child requires ψ units of parental time, normalizing parental time endowment to 1, and denoting the price of education by ξ , we have the following household budget constraint:”
  • The authors state this as an assumption.

    Education expenditures of parents are used to pay teachers who educate the children and thereby translate parental education expenditures into children's human capital.

    “Next, we assume that the education expenditures of parents are used to pay teachers who educate the children and thereby translate parental education expenditures into children's human capital.”
  • The authors state this as an assumption.

    The human capital of children increases with the education resources per child.

    “Assuming that the human capital of children increases with the education resources per child, and denoting the productivity of teachers by κ , we get the following law of motion for individual human capital:”
  • The paper relies on this without support.

    Demographic cycles are out of phase across countries.

    “It takes advantage of the fact that demographic cycles are out of phase across countries.”
  • The paper relies on this without support.

    Life expectancy has increased in all rich countries in the past decades.

    “Because life expectancy has increased in all rich countries in the past decades”
  • The paper relies on this without support.

    People spend more and more time in retirement.

    “people spend more and more time in retirement”
15 of 15

Self-check

Percentages, sums and reported differences re-computed from the paper’s own numbers.

1 of 1

Citations

Cites

Show all 193 references

Research works printed but not linked: 10

  1. 1965, National debt in a neoclassical growth model, Am. Econ. Rev., 55, 1126
  2. 2009, A special report on ageing populations, Economist
  3. 2011a., 70 or bust! Why the retirement age must go up. A special report on pensions, Economist
  4. 2011b, Briefing demography. A tale of three islands, Economist
  5. 2016, Demographic change, human capital accumulation and R&D-based growth, Can. Econ. Rev., 59, 707
  6. 2023, Public R&D, private R&D and growth: a Schumpeterian approach
  7. 2023, Medical progress, aging, and sustainability of health care finance, 61
  8. 2023, Social security reforms in heterogeneous aging populations, 199
  9. 2022, World population prospects 2022
  10. 2004, Living happily ever after: the economic implications of aging societies

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Metadata

Authors
Bloom, D. E., Kuhn, M., & Prettner, K.
Affiliations
  • Harvard University (US)
  • 3Wittgenstein Centre for Demography and Global Human Capital, Vienna, Austria
  • 4Department of Economics, Vienna University of Economics and Business, Vienna, Austria; email: klaus.prettner@wu.ac.at
Venue
Annual Review of Economics
Published
2024-08-22
Volume
16
Issue
1
Pages
159-184
ISSN
  • 1941-1383 (ISSN-L)
  • 1941-1391
OpenAlex
W4394930276
Cited by
64
References
193
Citations by year
2026: 36 · 2025: 24 · 2024: 4
FWCI
6.03
Type
journal article
Language
en
Open access
Locations
  • Annual Review of Economics (publishedVersion, cc-by)
  • SSRN Electronic Journal (submittedVersion)
  • WU Research (publishedVersion, cc-by)
  • IIASA PURE (International Institute of Applied Systems Analysis) (acceptedVersion)
  • RePEc: Research Papers in Economics (submittedVersion)
  • Econstor (Econstor) (submittedVersion)
  • IIASA PURE (International Institute of Applied Systems Analysis) (submittedVersion)
Topics
  • Social Sciences › Demography › Family Dynamics and Relationships
  • Social Sciences › Gender Studies › Demographic Trends and Gender Preferences
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Growth and Productivity
Keywords
low fertility, fertility decline, high-income countries, population decline, fertility determinants, long-run economic impact, fertility policy, population stabilization

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