Diffusion Processes and Fertility Transition Selected Perspectives (2001) / Chapter Skim
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4 Social Interactions and Fertility Transitions
4 Social Interactions and Fertility Transitions
Pages 115-137
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From page 115... ...
show that Asia and Latin America follow quite a different one and the African countries yet another. Although conventional economic explanations play an important role in several of the primary theories, the historical experiences appear to be too disparate for fertility transitions to have been generated solely in this way.
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From page 116... ...
We hope to add to this literature by emphasizing how these approaches can be embedded in a structural model of choices that embodies both contextual effects as well as feedbacks from the actual decisions of group members. This structural modeling approach will in turn have implications for statistical analysis.2 The second section of this paper provides a survey of the empirical evidence on fertility transitions that the social interactions model can help to explain.
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From page 117... ...
Since 1960, the rate of natural population growth for high-income countries fell, and the medium variant forecast of the United Nations for 2000 suggests that it will fall further. Interestingly, the crude birth and death rates imply that the decline in the TABLE 4-1 Birth, Death, and Natural Growth Rate By Income Group, 1750-2000 High-Income Countries Low-Income Countries Birth Death Growth Birth Death Growth 1750 6.5 4.0 1850 10.6 4.9 1900 9.9 6.7 1950 22.6 10.1 12.5 44.6 24.3 20.3 1960 20.1 9.0 11.1 41.9 18.3 23.6 1970 16.7 9.3 7.4 37.1 13.2 23.9 1980 15.2 9.6 5.6 31.7 10.6 21.1 1990 13.9 9.6 4.3 30.0 9.1 20.9 2000 13.1 9.7 3.4 25.3 7.8 17.5 NOTES: High-income countries include industrially advanced countries, such as Europe, North America, Asiatic USSR, Australia, New Zealand and Japan.
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From page 118... ...
Although Table 4-1 does not give a decomposition of the demographic components, it indicates that the huge increase in natural population growth rates for these countries stems from the reduction in mortality rates. These gains in life expectancy continued through the second half of the l900s, so that by 1990 there is no difference in crude death rates between high- and low-income countries.5 Notice, however, that while death rates fell by 67 percent, fertility rates only fell by 40 percent among low-income countries.
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From page 119... ...
That is, in Africa fertility rates fell only 20 percent, about onethird the decline of infant mortality rates, while in the other regions the ratio of percent change of fertility rates to percent change in the infant mortality rate is closer to 2/3 to 3/4. Thus, as we know from other studies, the fertility transition in African countries is distinct.
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From page 120... ...
To Notestein and other practitioners of classical demographic transition theory, modernization (development in modern parlance) and modern technology first decreased infant mortality rates, which as families realized that survivorship had improved, were translated into lower fertility rates.
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From page 121... ...
In contrast, this kind of threshold effect, that is, a situation where a change in a variable above or below some level produces a qualitative change in the properties of a system, is one which social interactions models commonly generate. The simple tabulation of aggregate statistics considered so far misses the spatial dimension of fertility transitions.
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From page 122... ...
Alternatively, contextual effects appear if fertility rates vary with the socioeconomic composition of the reference group. Finally, correlated effects occur when "individuals in the same group tend to behave similarly because they face similar institutional environments or have similar individual characteristics." A correlated effect would be present if households within the same group face the same costs and benefits of childbearing and therefore have similar fertility profiles.
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From page 123... ...
Social interactions generate social multipliers,8 which exogenous social effects do not. By social multipliers, we refer to the idea that the total change in individual incentives in a population leads, through interactions, to an effect in excess to that generated directly by the change in incentives.
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From page 124... ...
At the same time, the collectively efficient set of choices (in this case both players choosing high) is also sustainable as a Nash equilibrium.
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From page 125... ...
Social Interactions as Complementarities The basic ideas of our two-person game with multiple equilibria have been elaborated in an important paper by Cooper and John (1988~. In this model, they consider how each of a group of I individuals chooses an effort level e, which is constrained to lie in the interval [O.
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From page 126... ...
First, the Nash equilibrium can be inefficient. To see this, we can ask what common effort level would be agreed upon if individuals could coordinate their decisions.
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From page 127... ...
The first idea is that there is a deep relationship between multiple equilibria and the condition that the optimal decision of one agent is increasing in the choice levels of others. The potential for multiple equilibria gives scope for social norms to combine with individual incentives to determine aggregate population behavior, in the sense that these norms can act to coordinate behavior on one of the possible equilibria.
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From page 128... ...
shows how many social interactions models can be placed in our discrete choice framework without any reduction of the economic logic driving their main features, so we believe this analysis can be generalized to have wide application in demography. As we have noted, one of the most important features of social interactions models is their capacity to generate multiple steady states and this feature will reappear in our stochastic model.
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From page 129... ...
This feature means that our social interactions model nests the standard model of choice as a special case, and so the logic of the analysis in no way deviates from standard economic reasoning. Second, we assume that the random private utility terms are extremevalue distributed, so that their difference has the standard logistic distribution.
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From page 130... ...
If the strength of social interactions, as measured by J is below 1, these interactions will be too weak to generate multiple equilibria. If the strength is such that J > 1, then the presence or absence of multiplicity will depend on the private incentives for one choice or another as measured by h.
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From page 131... ...
We start our discussion of empirical implementation of social interactions models by considering the conditions under which the binary choice model of the previous section is identified. Therefore, we assume that the model is a correct specification of the structural determinants of individual and group behavior and consider whether the model parameters can be recovered from behavioral data.
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From page 132... ...
Manski's (1993) nonidentification results for social interaction models were obtained in the context of a linear model; as shown by Brock and Durlauf (1999a,b)
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From page 133... ...
Therefore, a violation of the rank condition would require that there is a composite individual characteristic that perfectly predicts a composite neighborhood characteristic. This is equivalent to saying that with respect to that composite individual characteristic, there is perfect segregation of neighborhoods.
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From page 134... ...
Applied to fertility transitions, the insight of the social multiplier is that economic conditions need only change enough to get a few "leaders" to switch behavior. Then once in play, endogenous exchanges among agents (i.e., social interactions)
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From page 135... ...
However, when combined and employed in a structured way, economic determinants and social interactions offer a rich set of mechanisms by which to explain the process of fertility transitions. The daunting task for researchers is to harness the theoretical insights from these models and implement empirical representations that will help us understand sometimes elusive and always complex fertility behavior.
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From page 136... ...
Bongaarts, J., and S Watkins 1996 Social interactions and contemporary fertility transitions.
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From page 137... ...
Mason, K 1997 Explaining fertility transitions.
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