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Can Population Projections be Used for Sensitivity Tests on Policy Models? - WP 03/07

5  Variants’ rankings differ with the outcome considered

Changes in fertility, mortality, and migration rates all have different effects on population structure. An illustration is provided by Table 3, which gives selected results from Statistics New Zealand’s 2001-base population projections for 2021. As comparison of Series 2 and 6 shows, differences in migration rates have a major effect on population size but have a minor effect on dependency rates. Comparison of Series 1 and 8 shows that, in contrast, differences in fertility rates have a minor effect on population size, but a major effect on dependency rates. An alternative choice of time period, or differences in the age-profile of migration, could affect the comparison. It is generally true, however, that variants do not have stable rankings, in that a variant yielding high values for one variable, such as population size, does not necessarily yield high values for another variable, such as the dependency ratio (Lee 1998; Bongaarts and Bulatao 2000: 192-4).

Modellers who are not aware of this phenomenon are at risk of constructing demographic sensitivity tests that are even weaker than necessary. Modellers might, for instance, be impressed by the ability of Series 1 and 5 in Table 3 to bracket a wide range of plausible dependency ratios and not realize that these series do not bracket a wide range of plausible population sizes. If the modellers use Series 1 and 5 to carry out a sensitivity test on a policy model that is sensitive to population size, this sensitivity may not be apparent. This is again an instance of Case 6.

Table 3 – Statistics New Zealand projections variants for total population and dependency ratios in 2021
Series Fertility Mortality Net migration Population, thousands (As % of Series 4) Dependency ratio (As % of Series 4)
1 Low Medium 5,000 4,396 (98%) 51% (94%)
2 Medium Medium 0 4,374 (97%) 55% (102%)
4 Medium Medium 5,000 4,506 (100%) 54% (100%)
6 Medium Medium 20,000 4,821 (107%) 53% (98%)
8 High Medium 5,000 4,616 (102%) 57% (106%)

Source - Tables 1 and 3 of the Statistics New Zealand’s National Population Projections (2001(base) - 2051) available online at www.stats.govt.nz

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