Economics and Rapid Change – The Influence of Population Growth

Richard P. Cincotta and Robert Engelman

While the linkage between demographic and economic dynamics is undeniably complex, new data make clear that during the 1980s, on average, population growth dampened the growth of per capita GDP. The negative effects of rapid population growth appear to have weighed most heavily on the poorest group of countries in the developing world throughout this period.

More positively, declines in human fertility in the 1970s and 1980s almost certainly helped fuel explosive economic growth during the 1980s and early 1990s in many East Asian countries. National studies in various regions provide substantial evidence that smaller families, later childbirths and parents¹ enhanced capacity to plan their families‹factors that slow population growth through declines in fertility‹create opportunities at both household and national levels that have positive implications for education, health, and labor and capital markets.

Population affects the course of national economic development. But so do modern institutions such as competitive markets, flexible public policies and well-run government programs, which help economies adjust to the rapid changes produced by population growth. Adjustment has its costs, however.

This paper draws attention to the long-term consequences of even those institutional adjustments that successfully cope with stresses related to population growth. The authors conclude that the long-term costs of these adjustments are most often paid by groups and interests to which institutions respond inadequately or not at all: the presently marginalized, future generations, and the natural resources on which present and future societies depend.

 

Table of Contents

  • Introduction
  • Objectives
  • On Economic Growth
  • On Employment and Poverty
  • On Savings and Investment in Physical Assets
  • On Investment in Human Assets
  • Schools of Thought
  • The Revisionist Perspective
  • After the Review
  • Feedbacks: Economic Ascent
  • Feedbacks: Economic Stagnation and Decline
  • Policy Implications
  • Institutional Limitations
  • Institutional Bias
  • Adjusting to Population Growth: The Case of India
  • Improving Understanding
  • Acknowledgements
  • Endnotes
  • Key References