The debate over the influence of population growth on national economies has been around for more than two centuries and the dominant stance on the matter changes frequently. Apparently, the shifts in perspective have much to do with the periodic context.

Thomas Malthus: A Larger Population Means Less Resources per Person

It began in 1798, when Thomas Malthus theorized that population growth would eventually lower overall wealth across the world. As a population expanded, Malthus explained, there would be less space and resources to go around. As a result, everyone would have to make do with less, leading to a lowered standard of living, and increased levels of illness, hunger, and war. Of course, technology in agriculture has played a massive role in debunking this theory as have the advances in medicine, science, and technology. The world is inhabited by over 7 billion citizens today, far more than the 1 billion in 1798, and in most places the standard of living has vastly improved.

1950-1970: Poverty Is the Problem, Family Planning is the Solution

Nonetheless, throughout the 1950s and 1960s – a period of rapid population growth especially in developing countries – many economic policies were driven by the basic tenets of Malthus’ theory. It simply seemed logical: a large family has more mouths to feed, and less money to invest in each individual family member. As a result, every last cent would rather be used to answer basic needs than put aside as an investment for the future. This type of financial conduct ultimately trapped large poor families in a hand to mouth existence. To remedy the expected economic decline, governments focused on promoting what Malthus called ‘moral restraint’ – encouraging people to have less children. A lot of international funds were put into family planning programs with the hope of lowering the birth rate and overall population growth.

New Approach: Population Growth as a Neutral Phenomenon

However, in the 1970s, with the increasing access to international data, new perspectives began to appear. Several researchers and economists argued against the Malthusian theory, firmly establishing that population growth was a neutral phenomenon and had little or no effect on per capita economic growth. Some believe that this new perspective contributed to a significant drop in family planning program funding.

Population growth and avarage rate income growth

But Then Again…

In the 1990s the tables turned once more. Demographers and economists who analyzed the economic development in East Asia over the 20th century found that a significant increase in savings and investments could be attributed to a decrease in childbirth some years back. Because of the lower birth rate, a larger segment of the population was of working age, creating a ‘demographic dividend’ that boosted the economy. During the same decade another important research showed that there is indeed a negative link between population growth and economic development and that it is evidently strengthening over time.

All the conclusions presented above were based on solid research and logical thinking, how then could they be so different? The answer has to do with historical context. While we have focuses on two elements – fertility rate Vs poverty – reality is more complex. The fact that two trends coincide does not necessarily mean they are connected. But then again, maybe they are.

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Is There a Link Between Population Growth and Poverty?
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Is There a Link Between Population Growth and Poverty?
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Does population growth affect the economy? The debate still continues to cause controversy. Discover how large families lower the standard of living around the world.
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Nip Global
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