Across emerging economies, the benefits of a "demographic dividend" have become a familiar refrain. Politicians and business leaders alike — be it in India, Nigeria, Pakistan, or Tanzania — talk glowingly of how a fast-growing and youthful population will create huge investment opportunities and fuel rapid economic growth. But the reality is that in many emerging economies, rapid population growth poses a major threat to economic development and technological progress will make that threat even more severe.

For starters, the term "demographic dividend" is being seriously misused. The term was originally used to describe a transition in which countries enjoyed both a one-off increase in the working age population and a significant fall in fertility. That combination produces a high ratio of workers to dependents — both retirees and children — making it easier for high savings to support sufficient investment to drive rapid growth in capital stock.

Rapidly falling fertility, meanwhile, ensures that the next generation inherits a large capital stock per capita: and small family size makes it easier to afford high private or public education spending per child, leading to rapid improvements in workforce skills. South Korea, China and some other East Asian countries have benefited hugely from such a demographic dividend over the last 40 years.