FIGURE 23.1 Demographic transition. The theory of demographic transition models the way that birth, death, and growth rates for a nation change with economic development. Phase 1 is a preindustrial period characterized by high birth rates and high death rates. In phase 2, as the society begins to industrialize, death rates drop rapidly, but birth rates do not change. Population growth is greatest at this point. In phase 3, birth rates decline for a variety of reasons. In phase 4, the population stops growing and sometimes begins to decline as birth rates drop below death rates.