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Assessing the Relationship between Population Growth and Economic Growth Karen Chang Chih Hua Chen Jessica Chen Derek Shum Gabriela Alcaraz Dennis Yue
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Overview Problem: High population growth in developing countries Solution: Economic growth Expanded labor force that utilizes the productive capacity of women Reduces the need for large families to perform the tasks of subsistence
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Our Research Developing countries: higher marginal productivity Average annual growth rate during 1965-99: 4.1% in low-income countries 4.2% in middle-income countries 3.2% in high-income countries Trend: low-income countries will one day exceed the GDP of today’s high-income countries However, population growth in developing countries > developed countries Large increase in GDP in developing countries GDP growth is offset by faster population growth Negative correlation: economic and population growth rates
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Opposing Views As income increases, both the birth and death rates decrease. Since these forces are offsetting, the rate of population growth is independent of the rate of economic growth.
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Variables in the Analysis Fertility : Birth rate Economic Growth : GDP per Capita Growth Regional Dummy Variables - to control for cultural differences across regions, religion dummy variables were incorporated in order to account for regional/cultural and religious differences which may influence birth rates. Secondary school enrolment of females: incorporated based on the findings that higher female education levels contribute to lower birth rates
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Variable Included in the Analysis
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Descriptive Statistics for Numerical Variables
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Histogram of GDP per Capita Growth
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Histogram of Birth Rate (per 1000 people)
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Histogram of Secondary School Enrolment of Females
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Regional Distribution of the Data
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Distribution of Countries by Religion
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Scatter Diagrams of the Numerical Variables
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Correlation Results
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Results of First Regression
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Heteroskedasticity
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Residuals vs. GDP per capita growth
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Residuals vs. Secondary school enrolment of females
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Full Model Results
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Regression model results excluding Europe and N.A., Education and Catholic
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White Heteroskedasticity test for full model
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Regression birthrate vs. regional dummies
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Regression birthrate vs. regional dummies, GDP and education
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Final Regression Model
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Regression model considering interaction between the variables
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Conclusion Negative relationship between economic growth and population birth rates Female education levels a negative relationship with population birth rates Religions that discourage the use of birth control such as Catholicism and Muslim religions have a significant positive effect on birth rates
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The End Questions?
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