What is your opinion regarding to the above question?
It is important to note, therefore, that demographic projections should not be confused with economic forecasts. Changes in the number of people, families, or households do not necessarily relate to the social and economic well-being of an area.
The Relationship Between Economic Growth and Population Growth. ... On the other hand, if population growth affects per capita output growth, higher population growth rates would contribute to either higher or lower overall economic growthdepending on the nature of its effects on per capita GDP.
I agree with you that population change is not necessarily correlated with wellbeing. Depends on what kind of changes you have in mind. Right now we are doing research on youth emmigration from Croatia, which at first sight shows positive effects: unemployment decrease, less social cost etc. but in the long run the effects will be truly negative for society and economy.
Of course the relationship between the population change and economic growth was influenced according to the sustenance level of each country and their life ,Low population growth in high-income countries is likely to create social and economic problems while high population growth in low-income countries may slow their development.
http://journals.sagepub.com/doi/full/10.1177/2158244017736094
When population is growing the economy of a country will also tend to grow. If a population becomes older and is not growing the consumer demand of that country will tend to stagnate. A growing population helps an economy by creating an increase in demand as world economies respond to demand dynamics which have a heavy population and youth influence. There is also a tendency for happiness index to increase with increased economic success. This follows a curves of decreasing returns on the increase of economic abundance. It is difficult for people to maintain an optimized sense of well being if they are experience a lack of adequate nutrition. If economies can maintain a sufficient level of security and have a sense of purpose and future the society can prosper in many senses. Freedom can be a useful element of giving society the ability to grow and prosper. Centrally controlled dictatorial societies can have real issues in relation to economic growth and their happiness index. Take as a prime example the eplorable situation of Venezuela which could have the largest fossil fuel reserve but suffers for complete economic breakdown which has to point famine and the unhappiness has to be off the charts. Not unrelated the area is experiencing negative population growth as who can are fleeing with dispatch and considering the situation this is a prudent reaction to a catastrophic situation which is completely related to breakdown in basic institutions which would favor growth.
According to the study carried out by Gideon Thuku,
"The debate on the relationship between population growth and economic growth has been undergoing and varies across countries. The first theory states that population growth stimulates economic growth. The second theory view population growth as a factor that adversely affects economic growth while a third school is that population growth is a neutral factor in economic growth and is determined outside standard growth models." ( Gideon Thuku "The impact of population change on economic growth in Kenya"
https://www.researchgate.net/publication/307780119_The_impact_of_population_change_on_economic_growth_in_Kenya )
Economic growth can be attained from
(a) To raise total output
(b) To check and control increase in population
(c) To ensure capital formulation
(d) To raise entrepreneurship.
as stated, population must be controlled to develop economic growth of a country.
It depends on the stage of development and the population density in habitable places.
In early stage of development population growth helps increase size of the economy. Later in moderately developed places the population growth may still increase the economy, but with marginal resources being brought into production.
A fully developed economy does not necessarily benefit from population growth. More likely it tends to push wages and incomes down and lower the standard of living. Not all members of the society are affected the same.
Population change can be impacted on the economic growth. Population change will be effecting the whole economy such as education, health,employment, infrastructure facilities and etc. The population growth or change must be controlled in order to increase the economic growth of the country.
This has to do with the level of development of a particular country. Uncontrolled population growth for developing country may have negative effect on the economy growth. However, a well controlled population growth in a developed and a well organized country will bring economy growth.
Sometimes the relationship is inverse and sometimes indirect depending on the development of the country and the infrastructure and giving members of the community and the extent of their interaction and self-sufficiency.
I think that the relationship is different between them, so it is a time and time again.
Population changes do not necessarily correlate to economic well-being of an area. It depends on so many factors, one of the most fundamental factors, I think, is the infrastructure provided in the society. If the infrastructure is well-developed, then there will be enough job opportunities, well-paid occupations, convenient transportation, free and high-quality education, and other means of economic well-being.
As a first approximation, I think that simply, if the standard of living must remain the same, then economic growth must occur at the same rate as population growth. But there is nothing chiseled in stone that says economic growth must occur in sync with population growth.
If population growth exceeds growth of the economy, the standard of living goes down. Vice versa, if economic growth exceeds population growth, the standard of living goes up.
Then you also have to take into account the age demographics. If the population ages overall, let's say no growth, but only aging, or even population decline which will also result in aging (barring some dreadful epidemics causing the decline), it will be difficult to maintain the standard of living. Because as people retire, and the population ages as a whole, that means that fewer people will be funding pension programs. That hurts. You might hope for greater automation and such, to make up the difference.
I think that considerations of infrastructure, and so on, are all contributing factors to the standard of living, but secondary. The main event here has to be whether the economy is keeping up with the population, in terms of size and age demographics.
I agree with most of my RG-colleagues' answers especially with dear Dr. Mirna Leko-Šimić. Many thanks.
When population grow there is more demands for goods and more expenditures. This in turn must be accompanied by an economy that has low unemployment rate, low inflation and high income. So we can say that population can be a negative and positive aspect for the economy. Positive example China, negative examples many (no need to list).
Population growth is an essential condition affecting economic growth. The lower the population, the greater the economic development process and the reduction of poverty.
Economic growth is just the total increase in the wealth of society regardless of the total population. While economic development is not only an increase in social income, it must be accompanied by a fundamental shift in the well-being of the poor, increased levels of education, health, etc.
I believe that the increase in the population will lead to a reduction in the living standards of the population, unless there is an interest by the population in their living standards and an attempt to increase them by increasing production.
The Relationship Between Economic Growth and Population Growth. ... On the other hand, if population growth affects per capita output growth, higher population growth rates would contribute to either higher or lower overall economic growthdepending on the nature of its effects on per capita GDP.
Short and Beginning Theses Correlation of World Population Growth and Economic Growth
Dr. Sandra Santrac
Creating a Future Scenario of Worldwide Population Growth Screening requires a multidisciplinary approach, teams composed of economists, geo-economists, cultures, anthropologists, natural resource experts, futurists, food production specialists, urban regeneration, mega cities, and many others, which should bring an action plan of the reality of scenarios that in any case cannot be beneficial. This so sensitive issue of the future is just equivalent to the potential of a nuclear conflict. The lighter will be resources, but drinking water. Serious scenarios must work under the patronage of leading world countries with true UN co-ordination with other countries around the world. Theoretical explanation of the impact of total state or world consumption on the rate of economic growth requires a comprehensive overview of empirical research and scientific articles dealing with population size influence, ranging from state, regional, continental, and global levels to economic growth. It is necessary to ascertain whether government spending stimulates or slows economic growth, and establishes whether there is an optimal level of government spending, ie the point at which the state at a certain rate of government spending maximizes its growth. By reviewing numerous scientific studies and research papers, and based on a regression analysis, it is concluded that in most EU countries and OECD countries there is excessive government spending that, through high taxes, slows down the rate of growth. A review of literature has also provided strong theoretical backgrounds, as well as studies that confirm the theory, the existence of a reverse U-curve, the so-called. BARS curve showing the quadratic ratio between the size of the state and GDP growth rate.
The following curve describes the positive effect of public spending with reduced productivity (Figure 3). The sharp positive effect of public spending is the gain associated with correcting market failures. The law of declining yields explains the fall of the curve after point G *. The fall in the curve is also explained by the fact that when there is no market, there are no more market failures. This double effect explains the shape of the curve and the benefit of correcting market failures. Therefore, public consumption has a positive impact on economic growth, but with the reduction of the marginal effect. The advantage of correcting market failures explains the growing phase of the BARS curve (left from point G *). The so-called SF curve (Figure. 2) describes the negative effect of public spending with increasing borderline effect. State failure theory also explains the dysfunctionality of the size of the state and the negative impact of public spending on the GDP growth rate. This reversed U-curve represents the overall effect of public spending, ie the combination of benefits from market failure correction (Figure 2, MF curve) and government failure costs (Figure 2, SF curve). The BARS curve in itself summarizes theoretical the justification of the non-linear relationship between economic growth and the size of the state (Chao & Grubel, 1998; Facchini & Melki, 2011).
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The relationship between growth and state size, decomposition of the BARS curve,
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Author: Facchini i Melki (2011)
The theoretical basis for the existence of the BARS curve was confirmed by a regression analysis in the example of Finland where it was established that the optimal size of the state is 36.27%, which is considerably less than the present rate of 57%. The research methods used in the paper are the compilation, descriptive, deductive method, induction method, comparative method and regression model of the least squares. During the twentieth century, the role and size of state activities in the economies of most industrial countries expanded. Economic research has taken two main approaches to this development. One was to take the size of state activities as exogenous on the economic development process and to ask what effect the state activity has on economic growth. This approach is often referred to as the "Keynesian approach". Following this approach, the level of state activity on which the rate of economic growth is optimized is explored, and this level is called "optimal the size of the state ". As we have pointed out by the analysis of the size of the state-population at the level of the state are available data and more accurate budgets. The concept of "optimal state size" was formulated by Armery (1995). Similar to the Laffer curve, the U-curve or BARS curve shows the relationship between public expenditures defined as the share of GDP or GDP per capita and economic growth as the growth rate of aggregate production, showing the same reversed U shape.
Colocidally speaking, unproductive hands, which should be maintained only part of the reserve income of people can spend such a large share in total revenue so that they commit such a large number to hit on their main revenue, on resources intended to maintain productive labor, that all the prudence and good behavior of individuals will not be able to offset the loss and degradation of the products caused through this violent and forcible reckoning.
Let’s look broader than the two strands. Draw in the environment and ponder McNamara’s nexus: Preprint Public-Private Partnerships (PPP) in Africa: Harking the Holonomic
As Djaafar stated that the speedy growth of the world's population will result in less living standards.
Dear All RG Friends
Many Thanks For all your valuable informations
Best Regards
Mr. Asaad,
If it is insisted on such speculation, there is no point in trying to analyze it either by empirical or quantitative research. It is a waste of time, and research in order to design such a thesis is unprofessional and beyond research principles. Because if it's a question in the title:- What is the relationship between population change and economic growth? Then the question follows,
What is your opinion regarding to the above question?
And then in another passage:
It is important to note, therefore, that demographic projections should not be confused with economic forecasts. Changes in the number of people, families, or households do not necessarily relate to the social and economic well-being of an area.
makes finding answers and solving common trick issues.
Population growth increases supply and demand so would increase overall economic growth. However, that doesn't take into consideration the environmental impact, income distibution etc.
I think you could split up your question into two: What effect das population growth have on economic growth and vice versa.
After you have dealt with the way of causality you could ask yourself for the direction of the relationship - positive or negative causality.
Finally you will end up with four questions:
1. In how far does population growth affect economic growth positively?
2. In how far does population growth affect economic growth negatively?
3. In how far does economic growth affect population growth positively?
4. In how far does economic growth affect population growth negatively?
Personally, I think the Malthusian Trap Model is the best starting point for investigations between demographics and economics.
Economic growth is nothing more than resource expansion. Whatever growth you have in mind, whether positive or negative in itself is meaningless unless there is structural possibility of equitably sharing of the national income.
I would recommend reading the Ronald Lee (2003) article. The article covers the demographic transition theory in detail. The author explains how population growth has changed over time from stage one to four:
↑ B.R and ↑ D.R = stage one (pre-transition)
↑ B.R and ↓ D. R = stage two (early transition)
↓ B.R and ↓ D. R = stage three (late transition)
Low B.R and Low D.R = stage four (post-transition)
Where:
↑ = Increase
↓ = Decrease
B.R = Birth Rate
D.R = Death Rate
These changes have a direct and indirect effect on the growth and development of any economy. Also, Gregory and Hansen (1996) cointegration methodology, finds that there is a bidirectional Granger Causality (GC) relationship between population and economic growth for Japan, Korea, and Thailand. While a unidirectional relationship for China, Singapore, and the Philippines, population is found to cause economic growth. In Hong Kong and Malaysia, economic growth is found to cause population growth. On the other hand, in countries like Taiwan and Indonesia, there was zero GC relationship between population and economic growth.
In conclusion, the relationship between population growth and economic growth isn’t straightforward. Population growth could be a benefit or a cost to economic growth and vice-versa.
I hope this was Helpful!
For population change at least you have viewed the Malthus theory of population . We know that for the necessities of food shelter ,& growth is first necessary for the population for the people ,it is said basic elements which can meet only thru the economic growth .
With this in the present century that to be a good development both for the agriculture & industrial growth & agriculture growth is certainly important for the economic development for working population for agriculture & production of agriculture requirement which may meet the necessities of food growing areas the agriculture sector may certainly help to grow for the prosperity .
Industrial growth for the scientific development have helped economic growth of industrial sector creating an employment ,opportunities for the people & help to increase the standard of living for the people .
This is my personal opinion
Dr Asaad Ali Karam
Rapid population growth tends to depress savings per capita and retards growth of physical capital per worker. The need for social infrastructure is also broadened and public expenditures must be absorbed in providing the need for a larger population rather than in providing directly productive assets.
There is another point that is frequently confused in this discussion. Do we investigate the effect of population growth on GDP or on GDP per capita? Which one do you refer to, when talking about economic growth? The "total" amount of production will almost always rise with population size. The effect on GDP per capita is quite controversial.
GDP is necessarily non-decreasing with population size. The relevant issue here is whether GDP per capita is increasing with population size. The answer depends on productivity, that is, the efficiency by which the factors of production are used. GDP per capita will increase with population size for economies with efficient technology and human capital. GDP per capita will likely decrease with population size for economies with poor technology and human capital.
Technology and human capital are needed to counter the law of decreasing marginal productivity...
Population growth is one of the necessary conditions that affect economic growth. The smaller the population, the greater the economic development process and the reduction of poverty.
Rapid population growth tends to depress savings per capita and retards growth of physical capital per worker. The need for social infrastructure is also broadened and public expenditures must be absorbed in providing the need for a larger population rather than in providing directly productive assets. Population pressure is likely to intensify the foreign exchange constraints by placing more pressure on the balance of payment. The need to import food will require the development of new industries for export expansion and/or import substitution. The rapid increase in school-age population and the expanding number of labour force entrants puts ever-greater pressure on educational and training facilities and retards improvement in the quality of education, which is a problem in developing economies. Also, too dense a population aggravates the problem of improving the health of the population and intensifies pressure on employment and the amount of investment available per labour market entrant .
Population is beneficial to an economy due to the fact that population growth is correlated to technological advancement. Rising population promotes the need for some sort of technological change in order to meet the rising demands for certain goods and services.
https://www.omicsonline.org/open-access/the-impact-of-population-change-on-economic-growth-in-kenya-.php?aid=17291
I fully agree with Rachidi Kotchoni. Answer depends on productivity, but I have to add, that it depends on LABOUR productivity.
I think: Population growth leads to economic growth as long as there are resources (money, food, water, fuel, goods, etc.) to support them. Achieving economic growth without population growth means changing the job landscape to high-tech industries
I think that the link between economic and demographic growth is complex. Population growth can be beneficial for economy in underpopulated country, like Russia or Canada. But it can be a problem in an overpopulated country like India. I have a paper that considers an influence of population density on economy: Article Socio-economic influences of population density
There is, potentially, a two way relationship. 1) More people > more output. 2) more output > fewer babies. In the case of 1), there is likely to be a delay, if the more people are in the form of babies, becaure the partent (usually the mother) cannot work and the baby doesn't produce. In the case of 2), the number of babies falls as per cpita income rises. So population could, ultimately, fall. Then we are back to the case of 1).
Of course, if population growth comes from immmigrants of working age, then growth will occur as per 1). And when population is falling because births are below reproduction levels, the proportion of the population that is not of working age increases. This, too, will mean that outptut falls.
All this is dependent upon what is going on in the working age population. What share of it is actually working? And what is the inmplication of people starting work later because they are longer in eduction? Later entry as a result of longer education could enhance productivity.
Maybe people could work longer - which is associated with an increse in the working age population - but this requires also that people actually do retire later. The question, then, is whether an older workforce is less productive than a younger one. Some say "yes", some say "no". Research findings here are not very good, and more needs to be done.
Dear Asaad Ali Karam,
In my opinion, it is not possible to answer this question unambiguously without specifying which demographic and economic changes we are asking, and to what kind of countries and economic systems we are asking this question. There are many correlations to be found, but the research area needs to be clarified and the question clarified.
Best wishes
Yes, the interaction is complex. But there are several possibiities to approach this issue theoreically. My paper cited above was more about resource or agricultural countries, where population density matters a lot. However, we observe scale economies in cities, and if it is a successful city, populaton growth there can cause even higher economic growth. Certainly, up to some limit, when congestion effects will start to dominate.
Population growth affects the economic growth but whether positively or negatively depends on whether the rise of population is absorbed constructively in a society or not. Some countries that have low population growth demand for labor power from countries that have population at growth or stagnant but poor economic growth anyway. Its a complex matter.
I perceive that historically the population growth was far lower but the waqf institution played a great role in dealing with issues of poverty, basic population needs, and needs of population as a total. Hence it managed the dilema of population change and economic growth. Those waqfs were public properties and these facilitated economic development but also population growth. I have researched population growth in my publications available on research gate but to understand the role of waqfs in general historically can be understood from "Chapter Rising Interest in Waqf (1)
" or for models and types of waqf development that may help and be developed for population growth effect on economic growth and vice versa seeChapter Possible Scenarios for Waqf Development in Bosnia and Herzeg...
A whole story on the role of Waqfs in Bosnia and Herzegovina see Book Socio-Economic Potential of Waqf in Bosnia and Herzegovina b...
The waqfs have potential to curb population growth as public properties and facilitate economic growth and vice versa.
it depends according the country. The Human Development Index from UNDP can measure the level of socio-economic factor and it may display the relationship between population growth and economic growth.
However, some studies established an indirect link between population growth and economic growth such as introducing the job demand, level of education, the level of poverty...etc.
The study of the relationship between population change and economic growth should take into account the level of the country's economic development, production potential, income and wealth levels. Without taking into account these types of macroeconomic determinants, the picture of the analysis of this type of correlation would create an incomplete picture.
Best wishes
Dear Friends and Colleagues of RG
The issues of specific programs to improve the economic, financial, material and housing situation of households as key instruments of pro-development keynesian anti-crisis state intervention and significant components of the socio-economic policy of the state I described in the publications:
Article FAMILY 500 PLUS PROGRAMS AND FLAT PLUS WITH KEY INSTRUMENTS ...
Article Ability to Generate Financial Savings by Households in Poland
Article ECONOMIC AND FINANCIAL SITUATION OF HOUSEHOLDS IN POLAND – A...
Article The role and application of Keynesian macroeconomic anti-cri...
Article Soft monetary central banking policy and Plan for Responsibl...
Article Importance and implementation of improvement process of prud...
I invite you to discussion and cooperation.
Thank you very much
Best wishes
There may be a clear correlation between the change in the demographic structure of society and economic growth. Especially when the process of population aging is unfavorable for the economy. In the situation of reversing this process, multifaceted factors activating economic growth appear. I described this correlation in my publications on the Family 500 Plus Program and the Flat Plus Program.
Population growth can be a catalyst for economic growth, not as a constraint, as some claim, and as promoted by Western and international organizations that population growth is eroding economic growth.
According to Malthusian theory, a high population growth is associated with food problem, i.e., malnutrition and hunger but Bloom and freeman (1998) differ with the theory noting that food problem is more of a problem of poverty and inadequate income than a matter of high population growth. The population and food problem can be solved when income is enough to buy adequate food as prices provide adequate incentives to produce. On the other hand, developing economies would have to export more, receive foreign aid or borrow overseas to meet their increased demand for food by increased imports. A high rate of population growth not only has an adverse impact on improvement in food supplies, but also intensifies the constraints on development of savings, foreign exchange, and human resources.
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