Human Capital, Culture and the Onset of the Demographic Transition

This paper uses estimates of the dates at which different countries have experienced their demographic transitions to examine the main historical determinants of these transitions. We first show that genetic distance to the United Kingdom, a measure of cultural relatedness used in Spolaore and Wacziarg (2009), is positively associated with the onset of the demographic transition, implying that countries that have a larger genetic distance from the UK tend to experience later transitions. We then unveil a plausible mechanism that can rationalize this result. We show that genetic distance to the UK is negatively related to a country's initial human capital, measured as its schooling level in 1870. One interpretation of this finding is that a larger genetic distance is associated with higher barriers to technological diffusion and hence a lower demand for human capital. This low demand for human capital then delays the demographic transition by providing less incentives for households to switch from quantity to quality of children. Instrumenting initial human capital using genetic distance to the UK and alternative measures of adherence to Protestantism, we confirm the causal link between human capital and the onset of the demographic transition. Further, we show that the impact of cultural relatedness to the UK can be mainly attributed to its effect on educational levels.