Demographic transition is a phenomenon and theory in the social sciences (especially demography) referring to the historical shift from high to low rates of birth and death, as societies attain several attributes: more technology, education (especially for women), and economic development. The demographic transition has occurred in most of the world over the past two centuries, bringing the unprecedented population growth of the post-Malthusian period, and then reducing birth rates and population growth significantly in all regions of the world. The demographic transition strengthens the economic growth process through three changes: reduced dilution of capital and land stock; increased investment in human capital; and increased size of the labor force relative to the total population, along with a changed distribution of population age. Although this shift has occurred in many industrialized countries, the theory and model are often imprecise when applied to individual countries, because of specific social, political, and economic factors that affect particular populations.
Nevertheless, the existence of some type of demographic transition is widely accepted because of the well-established historical correlation between two factors: dropping fertility rates, and social and economic development. Scholars debate whether industrialization and higher incomes lead to lower population, or vice versa. Scholars also debate to what extent various proposed and sometimes interrelated factors are involved—factors such as higher per capita income, lower mortality, old-age security, and increased demand for human capital. Human capital gradually increased during the second stage of the Industrial Revolution, which coincided with the demographic transition. The increasing role of human capital in the production process led families to invest this capital in children, which may have been the beginning of the demographic transition.
