Will Policies to Influence Fertility Rates Be Effective? A Global Analysis of the Permanent or Transitory Nature of Shocks to Fertility Rates

This study investigates the stochastic properties of fertility rates across 196 economies in five regions from 1960 to 2020, utilizing a novel panel unit root test that controls for cross-correlations, gradual structural breaks, and other nonlinearities present in the data. This investigation presents the first-ever global empirical evidence on the nature of shocks to fertility rates, specifically whether they are permanent or transitory. Unraveling this property is vital as it influences our understanding of demographic dynamics and can guide the formulation of effective policy responses. Our findings reveal that the majority of the economies in our sample display stationary fertility rates. This discovery is of paramount importance for policymakers and stakeholders in demographic planning and economic development. It provides compelling evidence that shocks or policy interventions intended to influence fertility rates will typically exert only temporary effects. This insight cautions against assuming long-term impacts from singular interventions, suggesting instead that sustained policy attention and potentially recurring adjustments may be needed to secure desired demographic outcomes