Summary

Abstract

This study has examined interrelationships between population growth, income distribution and economic development. The object of the analysis was to obtain a better understanding of the various direct and indirect mechanisms through which population growth and income distribution influence each other, and to obtain estimates of the strength of each of these mechanisms. To this end, in-depth partial studies were made of the individual relationships and the outcomes of those studies were used to develop a multi-equation model of population growth, income distribution and economic development. The model differs in a number of respects from previous analytical modeis of the same topic:

• The demographic part of the model is not confined to fertility and mortality, but also incorporates the age and sex structure of the population.

• Income distribution is represented by the average income level and the degree of income (in)equality; both variables are explained by the model.

• The model not only considers direct relationships between population growth and income (in)equality, but also incorporates a number of indirect relationships that go through intermediate (socio-)economic variables such as education, health, nutrition, and labour force participation.

• It is not tried to estimate the time-lags in the relationships; instead the focus is on the estimation of long-term relationships (as defined in chapter 3).

• The measure of income (in)equality that is used as an explanatory variable in the equations is chosen with a view to obtain consistency between the macro-level relationship and the corresponding (nonlinear) relationship at the micro-level.