So, the birth rate problem is worse than forecast in 1976, 1986, 1992 and 1997. However, the birth rate is higher than was forecast in 2002 and 2006 – so has surprised on the upside. It’s only “worse than anyone imagined” if you’ve had your head in the sand for the last 10 or so years. As Noah Smith asks, didn’t any of the people tweeting the graph (it appeared at least half a dozen times in my feed) look at it?

That said, the chart demonstrates the lack of robust conceptual models that might be used to forecast fertility. As another example, the below figure comes from Lee and Tuljapurkar’s Population Forecasting for Fiscal Planning: Issues and Innovations and shows US Census Bureau forecasts through to 1996. As for the Japan forecasts, the tendency is to assume a slight reversion toward replacement fertility followed by constant fertility.

The Bureau of the Census produced high and low estimates (as in the figure below), but these don’t make the forecasting look any better. For many forecasts, the fertility rate was outside the range within 3 years. In 1972, fertility fell outside the range before the forecast was even published.

Over the last ten years, fertility “surprises” on the upside are typical in developed countries. Japan is not an outlier. Below are three consecutive projections from the Australian Government’s Intergenerational Report. IGR1 was published in 2002, IGR2 in 2007 and IGR 2010 in 2010 (obviously). As you can see, they’ve been chasing an upward trend in fertility. The fertility problem is less severe than once thought. Long-term fertility is assumed to be 1.60 in the 2002 forecast, but 1.90 in 2010. A new IGR is due out this year, so it will be interesting to see where that forecast goes.

As for building better conceptual models of fertility, I don’t envy anyone attempting that task. But as I argue in a working paper, evolutionary dynamics will tend to drive fertility rates up from recent lows. Is that part of the story behind what we are seeing in Japan and elsewhere?