In a speech to the Vatican in January, Pope Francis made an observation fit for an economist. He argued that declining fertility rates might lead to a “demographic winter”. In every European country the total fertility rate, the expected number of children a woman will have in her lifetime, has now fallen below 2.1, the level needed to maintain a stable population without immigration. The same is true in many developing countries, including China and (as of this year) India. This, the pope warned, would weigh on the world’s economic health.
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Economists have long considered such a slowdown inevitable. In the best-known model of fertility, popularised by Gary Becker, a Nobel-prizewinning economist, and others in the 1960s, there is a central role for the trade-off between the “quantity and quality” of…