When child and infant mortality rates decrease, fertility rates also fall. This drop in fertility is achieved through government policies essentially on family planning and health care for mothers, newly born and infants.

For a period of 20 to 30 years, economic growth increases. This is what is called the demographic dividend.

The changes brought about are as follows:

  • There are fewer investments specific for the young and funds can be transferred from infant and primary education to higher education thus increasing the skills of the population
  • There is a significant average life extension leading to an increase in the working age population
  • The workforce being younger, it tends to be more productive
  • Women are freed from pregnancies and child care earlier, have a better health, and can join the working population
  • Increased income serves to buy more and better food and a better fed population is more productive
  • Increased income is channeled into better education for both males and females
  • As the income from the majority of the population increases, there is less of a likelihood of social unrest
  • Part of the additional income is channeled into savings programs and can be used by corporations and government entities for investment.

However as the population ages, increased spending for the health and care of the aged is required.