Demography and Economic Growth in Spain: A Time Series Analysis

Resumo

In this paper, advanced time series econometric tools are employed to test the existence of relationships among demographic and macroeconomic variables in Spain along the 1960-2000 period. Annual data for the total fertility rate, infant mortality rate, per capita gross domestic product and wages are used in the empirical analysis. We first examine the bivariate Granger causality to look for short run relations. Then, a multivariate cointegration analysis is carry out, showing that two long run relationships among the variables exist with statistically significant coefficients. From these cointegration vectors, the vector error correction model is estimated to test the endogenous or exogenous character of the variables, finding that total fertility and gross domestic product clearly are endogenous variables. This is an important result to choose the most suitable framework to model the Economy. Finally, the main results from the multivariate causality analysis and the generalized impulse-response function show that total fertility responds directly to a gross domestic product shock, an increase in wages has a negative effect on both total fertility and gross domestic product, and infant mortality doesn’t cause total fertility. These combined results are useful to be compared with those expected from theoretical models of fertility.