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Demographic

methods

Temple University Ambler


Community and Regional Planning
CRP 410 Planning Methods
Professor Kurt Paulsen
November, 2005
Demography
• The scientific study of human populations,
primarily with respect to their size, structure and
development

• For planners, we would want to include: location


Demography and planning
• 53 P.S. § 10301.2

– “In preparing the comprehensive plan, the planning


agency shall make careful…analyses of housing,
demographic, and economic characteristics and
trends.”
In re Petition of Dolington Land Group and Toll Brothers
from the Decision of the ZHB of Upper Makefield Twp.,
839 A.2d 1021(Pa.2003)
• “The periodic analytic process employed…is, in
our view, an entirely appropriate method for a
municipality or multimunicipal jointure to meet its
obligation to provide for the proportion of regional
need for higher density, multi-family housing
fairly ascribed to it. Implemented conscientiously
and in good faith, this method will ensure that
land is available for development of an
appropriate variety of housing types on a
continuous basis.”
Demography
• To demographers, you only do a few interesting
things in your life (undergo a “demographic
event”
– Be born
– Give birth
– Move
– (Attract a migrant)
– Die

• The rest is details, I guess…


Demography
• This gives rise to the 3 major components of
demographic analysis:
– Fertility
– Mortality
– Migration
Demography
• Each of these components can be modeled as
complexly or simply as needed.
– Simple e.g.: Calculate “crude” rates
– Complex: disaggregated regression model of migration
decisions by age, race, sex, education, and economic
structure
– Complex: simulation models
Demography - components
• What influences fertility?
– Age
– Education
– Economic status
– Rates and timing of marriage/cohabitation
– Religion
– …and many others
Demography - components
• What influences mortality?
– Age
– Gender
– Income/Socio-economic status
– Genetics
– Behavior
– Access to health care…..
– ….and of course many more
Demography - components
• What influences migration/immigration?
– Age
– Economic structure/opportunities
– Public policies
– Quality of life, cost of living
– Climate
– ….and many more of course!
Demography - components
• You probably noticed that age plays a significant role in
all three components. Demography frequently employs
life-cylcle/temporal models. People’s probability of giving
birth, dying, migrating, etc. exhibit clear age effects.

• An important way demographers model “age” is to group


all those with a similar age into a “cohort.”
Demography
• Three basic types of demographic analysis used
by planners
– Descriptive – tools, data, and methods to describe the
population of an area
– Trends analysis – look at how demographic data has
changed over time
– Projections – estimates of future population and
population structure
Descriptive Demography
• You can access/acquire demographic data for a
place from a number of sources:
– PASDC
• http://pasdc.hbg.psu.edu
– Census
• http://www.census.gov
– Health Data:
• Pennsylvania: Bureau of Health Statistics and Research
• http://www.dsf.health.state.pa.us/health/CWP/view.asp?A=175&Q
• National Vital Statistics System:
http://www.cdc.gov/nchs/nvss.htm
Descriptive Demography
• After acquiring data for a place, you can calculate
all of the descriptive statistics we learned earlier
in the course, and use the statistics to tell a story
about a place
Descriptive demography
• Demographic-specific methods
– Age-Sex pyramids
– Dependency ratio = children + seniors divided by total
working age population
• Or: non-working population divided by working population
• Some researchers specify under 15 + over 65 as
“dependent”
Age-sex pyramids
• Age-sex pyramids are graphic representations of
the age and sex distribution of a population. The
show the percentage of a population for each sex
by age category/cohort. Typically they present
data in 5 year bins, although this is dependent on
your data.
Bin data – a note
• A lot of demographic data we have is not
individual data, but rather counts of the number
of people who fall into a certain category.
– Travel time (25 to 29 minutes)
– Age (birth to 4, 5 to 9 …)

• Some of our descriptive statistics have biases


when used on bin data
Bin data – descriptive statistics

• Consider calculating the mean travel time for an


area based on knowing the number of people who
fall into each category of time intervals. How do
we do it?
• To perform calculations, we have to make
assumptions about the distribution of data within
the bin.
Consider this travel time bin: 339 people in Richland Twp,
Bucks Co., travel between 25 and 29 minutes to work

339 people?

25 27 29
OR?

67.8 people

25 26 27 28 29
Bin data

• How do our two options differ in contributions


to overall average and standard deviation
calculations?
• Recall the formula for an average:

− x1 +x2 +x3 +... xn


x=
n
Option 1 = 339*27 =9153
Option 2 = 67.8*25+67.8*26+…67.8*29
= 9153
Bin data
• So, in this example, these two options are
equivalent in their effects on the overall mean….
• But what about the standard deviation?

• Ok, but what if, instead the real data looked like
this:
Non-symmetric distribution within a bin

300 people

39 people

25 25.8 27 28.1 29
25.8*300+28.1*39=8835.9
Bin data
• What are we left with? We have to make
assumptions about the distribution of data within
bins, but we have no a priori way to determining
which is “best”, and with the understanding that
our output is dependent on our assumptions.
Bin data strategy
• State your assumptions clearly
• Easiest solution is to assume all members of the
bin share the mid-point value.
• If exact results are important enough, calculate at
least 3 ways and present all 3 results (sensitivity
analysis)
• You could chose all lower values and then all
upper values for upper and lower “bounds”
• Don’t believe standard deviation calculations
from bin data!
Back to age-sex pyramids
• Age-sex pyramids provide a visual representation
of population structure. Consider the following
three national level pyramids from the U.S.,
Bangladesh and Germany.
Age-Sex Pyramids
• You can also produce pyramids for population
forecasts, to show the underlying demographic
structure.
Constructing an Age-Sex Pyramid

• See Excel Spread Sheet…Population Example.xls


on class server
• Step 1. Download age-sex data from the Census
Bureau website or other data server.
(factfinder.census.gov)
– Find variable P12 (Census 2000): Sex by age (total
population)
– If you wanted to, you could find sex by age for different
racial/ethnic groups
Age-Sex Pyramids
• Step 2. Unzip downloaded data, and transpose
data into columns.
• Step 3. Clean data such that it is 5-year age bins
with consistent labels.
• Step 4. Multiply Males by –1 (so on left side of
pyramid)
• Paste in format appropriate to Chart Wizard
• Make stacked Bar Chart. (second option on bar
chart chart wizard)
Special Excel Trick
• Reformat Axis to eliminate negative numbers.
Double click on bottom axis, chose “number” tab,
chose custom, in box type:
0;0
Click Ok.
Population Example
• Calculate Male/Female ratio, overall and for each
age category. Graph this to show general trends.
• Calculate overall dependency ratio. (For example
= 0.532) This means there are 53 dependents for
every working-aged person.
MALE/FEMALE RATIO BY AGE, LOWER MACUNGIE
TOWNSHIP, LEHIGH COUNTY PA, 2000

1.2

1.1

1
Male/Female Ratio

0.9

0.8

0.7

0.6

0.5

0.4
0 to 4 5 to 9 10 to 15 to 20 to 25 to 30 to 35 to 40 to 45 to 50 to 55 to 60 to 65 to 70 to 75 to 80 to 85
14 19 24 29 34 39 44 49 54 59 64 69 74 79 84 plus

Age Cateogy
0.4
0.5
0.6
0.7
0.8
0.9
1.1

1
0
to
4
5
to
9
10
to
14
15
to
17
18
to
19
20
ye
a rs
21
ye
a rs
22
to
24
25
to
29
30
to
34
35
to
39
40
to
44
45
to
49
50
to
54
55
to
59
60
to
61
62
to
64
65
to
66
67
to
69
MALE/FEMALE RATIO, UNITED STATES, 2000 CENSUS

70
to
74
75
to
79
80
to
85 84
an
d
ov
er
Demography – trend analysis
• Often, an analysis and visual presentations of the
demographic trends in a community can tell a
story and highlight significant planning issues.
• Recommended:
– Tufte, The Visual Display of Quantitative Information
– The Planner’s Use of Information
Trends – quantitative analysis
• One of the more common simple quantitative
analyses of past trends is to calculate “rates of
change” (works not just in demography)
• Rate formula:

X t +1 − X t
r=
Xt
Calculating Rates
• The population of a census tract in Montgomery
County grew from:
– 1990 population: 2371
– 2000 population: 3353

3353 − 2371
r= = 0.4142
2371
We read this as saying the population growth rate
from 1990 to 2000 was 41.42 percent
Growth rates example
• If the growth rate from 1990 to 2000 was 41.42
percent, what was the average annual growth
rate?

• If you said 41.42 / 10 = 4.142 percent per year,


that would be….WRONG – but a common mistake
• Why? COMPOUNDING!!!
Rates of growth (and decline)
• UGH!! Well, we might as well learn them now,
they’ll come in handy later in Cost Benefit
Analysis

• Open Word Document: “Growth Rates and


Decline Rates.doc”
1
This is the
So….  Vn  t
formula
g =   −1
 V0 
• So what is the average annual growth rate of
population for this Montgomery Census Tract?

1
 3353  10
g =  −1 = 0.03526
 2371 
We read this as a 3.526 percent average annual growth rate.
Growth rates
• Calculated growth rates can be used for:
– Estimating population between two censuses
– Projecting population based on constant growth rate
assumption
Final word on growth rates
• If r is the rate of population growth, then a
population will double in

ln(2)/r years!
Population Projections and Forecasts

• Clarify some definitions, keeping consistency with


Census Bureau:
– Estimate: indirect measurement of population for the
past, between Censuses, based on births, deaths and
migration figures.
• Released for July 1st of previous year
• Projections: estimates of population for future
years.
Projections and forecasts
• How “accurate” do I have to be?
– What is the cost of being wrong? Is the “error
function” symmetric?
– What is the cost of acquiring additional information and
analysis to produce a more accurate projection?
• All estimates, projections and forecasts are
subject to potential error. Open Excel sheet:
“forecasting.xls”
Population Projections
• Two basic types
– Top-down
• Applying constant rates
• Curve-fitting/extrapolation techniques
– Bottom-up
• Cohort-component model
• Distributed housing unit method

• There are also regression and structural models, not


covered in this class, but of use in many applications
Top down projections
• Constant rate projections:
– 1. Calculate average annual growth rate, using most
recent data. (e.g. 1990-2000).
– 2. Apply growth rate to future years.

– Incidentally, this is also called a “geometric” curve


Top-down projections
• Constant increment projections:
– 1. Calculate total number of people added per year.
– 2. Apply constant increment to future years.

– Also called “linear” curve


Curve-fitting/extrapolation
• Idea is relatively straightforward:
– 1.Plot the data
• In this case, population from previous time periods
– 2. Fit a curve to the data
• Made easier in Excel with “insert trendline”
• Problem: “insert trendline” has limited options
– 3. Derive the equation of the fitted curve
– 4. Use the equation to calculate future values.
Curve-fitting/extrapolation

• Step 1. Plot the data.


US Population
300

250
Persons (millions)

200

150

100

50

0
1790 1810 1830 1850 1870 1890 1910 1930 1950 1970 1990 2010

Year
Curve-fitting
• Step 2. Fit a curve.

• Types of Curves:The most commonly used curves


in population analysis are:
– Linear, Geometric, Exponential, Modified Exponential,
n-degree Polynomial, Logarithmic, Logistic, and
Gompertz.
– The number of possible curves is virtually limitless!
“Curves”
• No, not the fastest growing women’s fitness
chain….
• A “curve” is simply a mathematical formula which
describes the shape of the relationship between
data points.
• Characterized by at least 1 parameter.
• Given x, tells you what y equals.
• Let’s look at: “Population Projections
Worksheet.xls” on class server
Curves
• 1. Linear

y = a + bx
a=intercept, b=slope
Curves
• 2. Geometric

y = ab x

We can do a logarithmic transformation to get:

ln y = ln a + x ln b
Curves
• 3. “Power” (so called in Excel)

y = ax b

Again, a logarithmic transformation can make this more


estimable

ln y = ln a + b ln x
Curves
Called a 2nd degree
polynomial because
• 4. Polynomial
highest exponent is 2

y = a + bx + cx 2

Can create an n-th degree polynomial:

y = a + bx + cx + dx + ex + ...αx
2 3 4 n
Curves
• 5. Exponential

y = ae bx

• 6. Modified Exponential

y = c + ab x
Curves
• 7. Gompertz

x
y = ca b
Curves
• 8. Logistic

1
y=
c + ab x
Fitting curves to data
• See examples on Population Projections
Worksheet, “fittingcurves” with population data
from US.
– Graph data
– Fit curve
– Get equation
– Extrapolate
Bottom-up projections
• The most commonly used in planning is the
“cohort-component” method
• Cohort=age group
• Component=the three components of
demography (fertility, mortality, migration)
The Master Demographic Equation

• Put all three components together:

POPt +1 = POPt + Births − Deaths + Inmigration − Outmigration


Cohort Component Technique
• Step 1. Get age-sex data
• Step 2. Acquire “vital records” data
– Birth rates
– Death rates
• Step 3. Calculate survival rates.
• Step 4. “Age the survivors” – move to next bin
for next period
• Step 5. Calculate births
Cohort Component Technique
• 6. Allocate births to males/females
• 7. Project Population
• 8. Model migration as residual.
– -problem is we rarely have age-specific migration rate
AGE MALES FEMALES MALES FEMALES
0 to 4 579 504
5 to 9 753 666 574 504
10 to 14 694 747 753 661
15 to 19 662 589 694 747
20 to 24 347 316 642 589
25 to 29 384 414 347 316
30 to 34 530 578 384 414
35 to 39 676 753 530 578
40 to 44 808 868 671 753
45 to 49 846 917 793 863
50 to 54 823 834 841 907
55 to 59 627 657 808 834
60 to 64 458 462 593 637
65 to 69 “Age”404
each population
418 after
448 applying
452
70 to 74 a survival
358 rate 422 366 418
75 to 79 215 308 324 402
80 to 84 134 192 178 252
85 plus 87 190 113 223
Cohort-Component Technique
• Go to Excel spreadsheet:
New_and_Improved_Cohort_Component_Model.xls

• Gives you an examples of the technique with and without


migration.

• Caution: Example is a PA Township, but townships are


generally too small for accurate modeling without other
assumptions
• Generally, model larger areas such as counties or regions
Migration as a residual
• Recall the master demographic equation:

POPt +1 = POPt + Births − Deaths + Inmigratio n − Outmigrati on

• Can be rewritten as:

POPt +1 = POPt + Births − Deaths + Net Migration


Migration as residual
• In our cohort component technique, we have
projected populations based on births, deaths,
and age-cohorts.
• The only “unexplained” component is net
migration
• Can assume net migration is the difference for
each age cohort between the projected and
actual.
Migration as residual
• For example, take 1990 data to project (using
cohort-component) 2000 data
• Compare each age-cohort, 2000 actual and 2000
predicted
• Difference is net migration, 1990-2000
• Apply net migration data (either constant
increment or constant rate) to cohort component
method to project future (2010) population
Migration in cohort-component

• Problems: Migration is cyclical so past rates are


poor estimates of future rates.
• Modeling migration as residual might actually
reflect model error or variation
• Is the best available technique, however, for the
type of data currently available
Migration Data

• Alternatives exist: acquire detailed migration data from


Census or other
sources:http://www.census.gov/population/www/cen20
00/migration.html
• Problem: no internet sources of migration by age-
cohort for small-areas. Census released “Migration
DVD” on October 30,2003 for $70, but some data
disclosure/confidentiality issues
• Pennsylvania State Data Center has files available as of
October 2003 at the county level. See:
http://pasdc.hbg.psu.edu/pasdc/products_and_services/
Publications/migration/Migration_Flow_Tables_2000.ht
ml
Census Bureau

• Paper on Population Projection Techniques,


recommended reading for further methodology:
• “Methodology and Assumptions for the
Population Projections of the United States: 1999
to 2100.” Population Division Working Paper No.
38, US Census Bureau.
• On class server.
Census Bureau – sub-county population
estimates and projections

• Distributed Housing Unit Method


• Utilize Building Permits Data, mobile home shipment data,
and estimates of housing loss to provide intercensal
estimates of housing units.
• Then apply occupancy rates and average persons per
household (PPH) to derive population estimates, using
county population estimates as controls.
• County population estimates conducted through the
“administrative records” method.
Distributed Housing Unit Method
• Assumptions: “The assumption implicit in this
method is that changes in the occupancy rate
and/or the PPH are measured by the updated
county population estimate and that the rate of
change in occupancy and/or PPH is uniform within
counties.”
Distributed Housing Unit Method
• Continuous updating of housing unit counts through
“GUSSIE” (Geographic Update System to Support
Intercensal Estimates)…..wow!
• From the time of the last census, Census estimates
(through a complicated methodology) residential
construction, mobile home placement, and housing loss…
using building permits data, Survey of Construction, and
applying “loss rates” from the “Components of Inventory
Change Survey” (1993)
Distributed Housing Unit Method
• Before controlling for county population changes, the
formula is quite simple:

POPt = HU t * OCC * PPH


Where POP is the estimated population, HU is the estimated
number of housing units, OCC is the occupancy rate, and
PPH is people per household
Yeah, so what…who cares
• Why do we care so much about the method the
Census uses to estimate sub-county
populations???

• Estimates are used in Federal and State funding


allocations….its all about the $$
Distributed Housing Unit Method
• How accurate are these estimates/projections?
• Source: “Evaluation of 2000 Subcounty Population
Estimates” Greg Harper, Chuck Coleman and Jason
Devine, Population Estimates Branch, Population Division,
U.S. Census Bureau. 2002
• Census used to estimate sub-county populations with
administrative record-component method until 1996, but
replaced with Distributed Housing Unit Method in 1996,
presumably because more accurate.
Distributed Housing Unit Method
• Mean Absolute Percent Error (MAPE) is much higher for
smaller areas.
• Mean Absolute Percent Error (MAPE) is much higher for
areas with more rapid growth/decline rates
• Many municipalities in the Philadelphia suburban region
are either fast growing or relatively small.
• Mean Absolute Percent Error for Pennsylvania is 7.8
percent, below national average of 12.4 percent.
Demographic Projections
• All projections and estimates are subject to errors
• How important is it to get it “right”?
• Every method has its strengths and weaknesses.
• Every method makes assumptions.
• Demographic projections, in the “textbook” world,
feed into the land use planning and needs
analysis