Europe Ignores Correlation between Economic Growth and Birth Deficit

While there is massive immigration from other countries, many European countries’ domestic productive population that would help local economic growth is pushed to immigration — a policy that is bizarre and does not help economic growth.
Fotini Mastroianni | Oped Column Syndication
Fotini Mastroianni

The birth deficit concerns both demographers and economists. In many European countries, including Greece, the birth deficit is mainly treated with slogans and absurdities. In the process, a deeper analysis of the issue and its correlation with economic growth are ignored, despite the fact that the age structure of the population impacts the economy.

As the birth deficit is defined as the birth of fewer than 2.1 children per family, at least one of these children should be a girl in order to make up for the mother’s reproductive capacity.

Although many emphasize that birth deficit in Greece is particularly intense at the time of the economic crisis, this does not correspond to reality. As early as the 1950s, there was a downward trend in births (2.3 children per family), in 1981 it reached exactly the limits of reproduction (2.1 children per family). Since then, it has been declining with small growth periods due to the return of Greek immigrants and repatriates and the entrance of economic immigrants. Similar scenario exist in most of the other European countries.

An important factor for the birth deficit was internal migration from rural to urban areas and the transition of society from rural to post-industrial. In traditional rural societies, parents’ low status, lack of education, the closed social environment and the largest residential area (houses with a yard) — cause high levels of birth rates. In contrast, in post-industrial societies, the improvement of women’s position and educational level, women’s more frequent participation in social and economic activities, methods of contraception, income improvement, professional career accentuation (instead of family life) — reduce birth rates. In urban environments, the lack of living space (see apartments) has a negative effect on the creation of a family.

According to Schultz (1973), as parental income increases, the demand for more children decreases. At the same time, the transition to the post-industrial society is accompanied by a reduction in mortality and, thus, the aging of the population and the change in social trends. The acquisition of descendants for social recognition and self-esteem are no longer present, while the one-parent families and singles are increased and traditional families are reduced.

A key reason for the birth deficit in Greece (and in other European countries in crisis) is the minimal to non-existent support from the welfare state. Its complete collapse in the years of the crisis has aggravated the problem. Young people are not supported by the state to create a family, because there are no measures to help them combine their education or professional life with the family.

Greece was not an exception, but it coincided with the low birth rate of Western Europe. The high birth rate — according to relevant studies (Li & Zhang 2007, Li 2015) — has a negative impact on the economic development of a country, especially in the poor countries, compared to the rich. On the other hand, it is argued that when a country has a large part of its population in productive age, the highest degree of productivity will cause economic growth. If the population is elderly, then existing resources are used in a less productive way and, as a result, economic growth slows.

Different behavior of the age segments of the population is something that changes economic growth, i.e. young people invest more in education and fitness, while the elderly save and care for better healthcare. The population in productive age differs from the young and the elderly in the sense that they consume more than they produce (Bloom et al., 2001).

Based on the above, the lack of a birth increase strategy of the Greek governments and other Southern European countries is largely in line with the European Union’s requirements.

While there is a birth deficit and a shortage of a working-age population, the existing productive population is pushed tο immigration. Given the fact that this productive population is also highly educated, their immigration reinforces other economies such as the German economy and others. Massive masses of young immigrants (mainly males) are accepted in Southern European countries to fill the gap left of those who have emigrated.

This fact totally contradicts the economic theory of economic development. While there is massive immigration from other countries, the domestic productive population that would help local economic growth is pushed to immigration. This policy is bizarre and certainly does not help economic growth of the European countries under crisis.


Fotini Mastroianni is an economist, MBA lecturer, writer, blogger from Athens, Greece. She had taught, among others, at the University of Wales & the University of Glyndwr.


 

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