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Dependency Ratio

It is defined as the ratio of the combined age groups 0 – 14 yr. and 65 yr. and above to the 15 – 65 yr. age group.
Total dependency ratio

This is calculated for the society as persons above 65 yr. and children below 15 yr. are considered to be dependent on the economically productive age group (15 – 65 yr. age group)
young age dependency ratio
old age dependency ration

These ratios are at best can only be crude because they don’t consider the following:
1. All elderly are not unemployed or non-working
2. All children < 14 yr. may not be non-earning
3. Many among the productive age group (15 – 65 yr.)may not be employed or earning
The values for mid-2016 (i.e. July) in India were:
-Young dependency ratio: 43.97%
-Old age dependency ratio: 8.6%
-Total dependency ratio: 52.4%

The dependency ratios are used to study the dependency burden of the population of countries
The total dependency ratio tends to reduce as a country develops as the birth rate declines rapidly. This happens because the child population reduces faster than the increase in the older population in the initial period.
This rapid decline in dependency ratio especially the child dependency ratio has been recognized as an important factor for rapid economic development of the country.
With subsequent progress, the increase in older population far outweighs the decline in the child population because:
1. Further reduction in the birth rate is slow and
2. The life expectancy increases
This causes the total dependency ratio to increase once again with a shift from child dependency to old age dependency.
The initial decline in the total dependency ratio because of rapid decline in fertility until it rises again because of increase in life-expectancy is the period of ‘Demographic Bonus’. It can give substantial boost to development of the country.
If investment in education, skill development and health are pushed up during this period, maximum advantage can be extracted from the ‘Demographic Bonus’ for the economic growth of the country.
With subsequent increase in the elderly population, the total dependency ration rises once again, contributed mostly by the old age dependency ratio. This is termed as “Demographic Burden” and is inevitable consequence of development of any country.

Reference:
Park K. Demography and Family Planning. In: Park’s Textbook of Preventive and Social Medicine, 24th ed. Jabalpur, India: M/S Banarasidas Bhanot Publishers; 2017.

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English lecture on CSC taking: https://www.youtube.com/watch?v=rKxXIyJuBz8&t=24s
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