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Policy implications of my Ph.D. studies



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[Topics under debate]: GOOD GOVERNANCE
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As promised, after having obtained all clearances for my Ph.D.
dissertation, I am submitting a selection from my last chapter for those
who are interested in population, economic growth, family planning,
education, infant mortality, etc.

Pl. feel free to circulate these findings if you wish. I own the
copyright to my dissertation, but these findings should be in the public
domain for whatever they are worth.

Thanks,

Dr. Sanjeev Sabhlok

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Review
------	

   Does this mean that we are now in a better position to predict the
levels and direction of future fertility changes? The answer would be a
qualified yes and no. We now can say with more certainty that
macro-economic and institutional variables have strong effects on
fertility. If the developing world sees strong economic growth including
the provision of alternative markets for savings, and reduces infant
mortality, rapid declines in fertility would be possible in most
societies. If it is a goal of the policy maker to reduce fertility in a
society, the bulk of the focus should be on the demand side of the
fertility equation. Once the demand for reduced the number of children
builds up, it does not appear that the supply of contraception would
form a major hindrance or barrier to the fulfillment of this reduced
demand, since there were and continue to be many non-modern methods of
contraception in most societies. Indeed, to be more precise, without the
build-up of an appropriate demand, the mere act of supplying modern
contraceptive devices would prove entirely meaningless (as indeed has
been found in the case of Pakistan, for example, where family planning
workers have been known to dump condoms supplied from the 'headquarters'
into the rivers). 
	
	At the same time, we have much more to learn. We are only barely
beginning to understand the magnitude and direction of the impact of
these institutions. Therefore, the goal of achieving accurate prediction
of the magnitude of changes in fertility in the world, while definitely
nearer to us in terms of being fulfilled than it was a few decades ago,
remains distant even now. Changes in national fertility still continue
to take most astute observers and demographers by surprise despite the
many millions of dollars of research that has gone into this area since
the past four or five decades. This calls for greater multi-disciplinary
cooperation in the study of this area through the involvement of
economists, demographers, sociologists, anthropologists and even
psychologists.

Limitations and recommendations
-------------------------------
	It is clear by now that not only are there many theoretical
issues that need further study, but there are many limitations to the
empirical part of this study because of the nature of the data set and
the difficulty in creating some needed variables, apart from some
definitional and measurement issues. If we are to learn more about the
'mystery' of the formation of fertility desires, as a first step, a
panel data set needs to be created, spread over at least 15 years with
measurements taken every 5 years, commencing from the time of marriage
of the couples. It is true that we had observations on the young and old
populations, but since the crux of the study of formation of fertility
desires is the study of the formation of expectations, these have to be
traced out carefully, over time, to ensure that we are capturing exactly
how these desires are formed, changed and impacted by institutional and
other factors. In an essentially cross-sectional study of this nature,
the exact range and impact of security concerns does not come out in an
ideal fashion. Given that there will be attrition in the panel, and in
order to minimize possible loss of statistical significance, the number
of observations must be increased substantially from that of the current
study. 
	The measurement of desired fertility remains very problematic
and the questionnaire must be redesigned to eliminate as many potential
problems as possible. One of the most important findings of this study
was that husbands need to be studied with equal care as the wives, since
they play such an important role in the determination of completed
fertility. Hence all husbands should be surveyed in complete detail, and
if husbands are missing, a clear effort should be made to determine why
they are missing and how the environment of the woman changes in that
process. It is important also to trace the actual marriage patterns of
the household, to isolate the decisions taken in the first, second, and
additional marriages, if any, of either member of the couple. It would
be important also to elucidate information on the level of communication
and solidarity within a household, and its relative power structure. 
Expectational variables are very difficult to rely upon as being formed
exogeneously. A careful redesign of the survey would help minimize
possible measurement errors. Another difficult variable which
needs more care in its measurement is household income and the income of
the various members of the household. So also the issue of labor force
participation needs very careful analysis, since so many of the
components of this seem to vary at very short duration. 
	At the community level, the effects of alternative assets
markets, including insurance markets and the nature of the insurance
contracts available, need more careful measurement. A separate
measurement and analysis of social norms would be very useful, in order
to arrive at an understanding of the actual components of the norms set.
For example, it would be important to know the quantitative nature of
the 'norm' of exchange of bequests and parental services in the society. 	
	Despite these and possibly other limitations, this study is
perhaps one of the very few that has examined the formation of demand
for children at the micro-level and has also thrown light on the
possible relationships of fertility with labor force participation,
savings, marital solidarity, and bequests.

Policy implications
-------------------

      If the results of the study are anything to go by, there are some
significant implications that invite the attention of policy makers,
particularly those who are searching for ways to reduce the growth of
population in their countries. While it is always difficult to
generalize across countries from studies in a single country, some
regularities seem to emerge which might possibly hold across many
nations. 
      It appears that the key 'side' of the demand-supply equation for
children is the demand side. To the extent possible, the policy maker
interested in reducing fertility has thus to try to decrease the demand
for children first. This demand is crucially dependent on three things:
the growth of the economy and the consequent increase in the likelihood
of a higher level of future economic returns and insurance from
children, the likelihood of survival of children into the future, and
the reliability of social norms which underly the upholding of the
implicit intergenerational contract. The first two are relatively easily
impacted by the policy maker, while the third one is more problematic.
It would obviously be a good idea to focus on policies that increase the
likelihood of a child's survival and future income. At the same time, it
might be a good idea to slow down the onset of governmental social
security programs in rural areas which might give a false sense of
security about the possibility of government stepping in to support the
elderly in their old age. Such programs can only speed up the breakdown
of the extant, efficient, social norms for care of the elderly, and it
is very difficult to find any example of economically efficient social
security programs across the world. Most programs are ill-managed and
are a drain on their economy.
	As social norms break down, we have observed that there is
likely to be an inverted U-shaped effect on fertility. At the very
beginning, when norms are strong, favorable conditions will induce
people to have fewer children and to focus on quality. Sometime later,
as the norms start breaking down, people will want more children hoping
that they can use strategic methods to enforce return. But as the
breakdown of norms declines even more, and the reliability of children
becomes lower than that of alternative insurers, one would find that OAS
motives lead to a notable decline in the demand for children since they
are no longer good serve any major economic purpose. Thailand seems to
be distant from the second stage of increasing fertility, but if social
norms were to completely break down, then fertility might show a blip in
the positive direction before declining again. 
	Once a declining demand for children has set into place, it must
be supported by a provision of access to family planning services. For
societies that have very poor family planning services, it might be a
good idea to give the supply of contraception a boost in order to fulfil
the felt need of contraception. Thailand has had a very successful
family planning program. It is a good idea to keep it going.
	One of the findings of this study is that it is perhaps
ill-advised to focus resources on adult education unless one is looking
for possible short-term effects on economic growth. Parent's education
does not appear to have much bearing on the demand for children. People
are generally good at rational decision making irrespective of the level
of formal education they have had.
	A key policy implication of this study is that it is very
important to increase access of rural people to savings institutions. To
the extent that this is possible, in a socially efficient manner, it is
very likely that fertility will decline. On labor force participation
also, it was seen that more women will begin to work in non-farm
activities as their education and opportunity increases. That would have
further positive effects on economic development in general, as well as
cause a 'virtuous' spiral upwards into better living conditions and
reduced fertility.



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