Changes in Demography and Its Effect on Economic Growth in Developing Economies: Evidence from Selected African Countries

The paper investigated the role played by changes in demography in the growth of African economies during the period 1981-2017. Moreover, a comparative investigation of the effect of changes in demography on growth of selected economies based on the income level (namely high and upper-middle income, lower-middle income, and low income) was also done in this paper. Data for this study were sourced from the World Development Indicator (WDI) published by the World Bank. While, growth in GDP per capita was used to measure economic growth, demographic changes were examined from population dependency ratio, population gender distribution, and urban and rural population. The panel IPS unit root test conducted showed that all the time series for all categories of African countries examined were stationary at levels; hence the fixed/random effect panel regression models were estimated. Based on the result of the Hausman test, only one fixed effect was used to explain the effect of changes in demography on economic growth. First, it was found that age dependency ratio of entire population had a negative significant effect on economic growth among all African countries and lower-middle income countries in Africa. Secondly, age dependency ratio of the aged and young population had positive and significant on economic growth among all African countries and lower-middle income countries in Africa (with the magnitude of age dependency ratio of the young being greater). Thirdly, increase in female population impacted positively and significantly on economic growth among African countries. Fourthly, increase in male population had negative and significant impact on economic growth among all African countries and lower-middle income countries in Africa. Fifthly, increase in rural and urban population impacted positively and significantly on economic growth among African countries, high and upper-middle income countries, and low income countries in Africa. Lastly, while increase in urban population had more impact on economic growth among African countries, increase in rural population had more impact on economic growth among low income African countries. Among others, the study recommended that economic empowerment programmes should concentrate more on the women population as women in African tend to be more enterprising in managing small businesses that has been considered a catalyst for economic growth in the African continent.