Trade dependence and fertility in Asia and Hispanic America: 1950-1990.

Abstract

This research has modeled the development and fertility relationship under trade dependency of Asia and Hispanic America following Hout's (1980) conceptual model. The findings from the analyses show that the initial effects of development were positive and significant, which were consistent with the theory, and as predicted by Hout's model. In all the empirical equations, all of the dependency terms, measured as the top commodity concentration, the top three commodity concentration, or the partner concentration, were positive and significant. This is consistent with the theory and consistent with Hout's (1980) findings. The results of the development squared term suggest that the well known long-term negative effect of development may have been misspecified in Hout's equation. As a result, the long-term fertility reducing effect of the development on fertility would have to be alternatively modeled. In this investigation, using 1950-1990 data generated by sample of both Hispanic American and Asian countries, Hout's (1980) positive interaction term was not replicated. In fact, the interaction term was just the opposite. Significant negative development-dependency interaction terms were found in every empirical analysis. A very stable result in terms of the development dependency interaction was obtained by using all three measures of dependency. While the commodity concentration measures were more important in Asia and the partner concentration (P) was higher and more important in Hispanic America, the negative interaction resulted in all analyses--including the overall best empirical equations in all of the analyses. The results consistently indicated that as dependency increased, the long-term negative effect of development on fertility increased in magnitude. This long-term effect is explained by an alternative theory linking the relationship between fertility on the one hand, and development and dependency on the other hand, as an interaction. According to this alternative theory, the interaction assumes that development and dependency can vary somewhat independently of each other. Thus, high levels of dependency should strengthen the negative long-term influence of development on fertility. While the results are consistent with the theoretical interpretation of the negative development-dependency interaction, the detailed implications of the alternative theory need to be investigated.