Why Economists Are Interested In Population Problems?
The economist is interested in population problems, either on an international or national scale, for two main reasons:
- Production of goods and services depends on the labour force.
- Consumption depends upon the demand of the population for goods and services.
Figure 4.1 illustrates the world population from 1750 with projections to the year 2015. Population statistics, particularly before 1900 and after 1980, are subject to errors as large as 10 per cent, but they do indicate the enormous increase in world population and give some intimation of the exceedingly difficult problems to be faced. There are problems with employment: whether or not we can find employment for all those who are physically and mentally capable of working. There is the basic problem of food supplies. How shall we cope with the 6500 million people who are expected to be alive in the year 2000? Such questions are being asked in all sorts of economics assignments and students avail economics homework help to tackle such problems.
Figure 4.1 World population growth from 1750 to 2150 AG
(Source: UN Report 1974). The Economist. 17, 1974; Employment: whether or not we can find employment.
Malthus and the neo Malthusians
Although the Reverend Thomas Robert Malthus (1766–1844) is usually associated with drawing the public's attention to the importance of population growth, he was not the first economist to have been concerned with the problem. Adam Smith believed that the demand for men regulated the production of men. The importance of Malthus lies in the fact that he inculcated a pessimism about the population problem under the shadow of which man still exists. Neo-Malthusians, or those who believe that the ghost of Malthus still lurks among us, might argue that we are still haunted by intense scarcity, malnutrition, and famine because the ideas of Malthus were not realistically accepted and that the pockets of affluence that exist in the western world have lulled Europeans and North Americans into a false sense of security.
Malthus has been a much maligned man, He did not advocate famine, war, disease, vice, and misery, but rather he believed that these tragedies would strike the human race if the population continued to outstrip the food supply. And even though, in the last few years, improved genetic strains of wheat, rice, and other major foodstuffs have brought new hope to mankind, it is still too early to say that Malthus will not prove to be right in the long run. Indeed. Malthus contended that it might take several centuries for the effects of his theories to be fully felt
However, Malthus was wrong to attempt to prove that there was an exact mathematical correlation between the supply of food and the supply of people. He put forward the theory that food production increases only in an arithmetical progression (2.4.6. 8...) whereas population increases in a geometrical progression (1, 2, 4, 8, 16, 32...). This has been rightly criticized by Professor Cannan as a "misleading mathematical jungle' Similarly, it is clear that man is not necessarily doomed to live at a level that entails scraping by for a bare existence. We ought to be able to organize our resources in order to challenge scarcity and improve the conditions of those unhappy people who, according to Malthus, "in the great lottery of life, have drawn a blank."
Since human wants are never-ending, the so-called level of subsistence moves ever upwards. The minimum number of calories necessary to sustain a life, where even a sedentary occupation can be done, is often quoted as 2200 a day. Yet it is possible for people to exist on less. The Neo Malthusians might well argue that the upgrading of calorific standards makes it an almost hopeless plight for the human race to catch up Man is chasing his own tail, especially as the population of the world is doubling every generation.
If population growth is not contained, even enormous efforts by the Food and Agriculture Organization will have been in vain. The World Health Organization has been keeping people alive for longer than the Food and Agriculture Organization can feed them. The ultimate goal must be to curb the production of people; in the long run, this may be more expedient than increasing food production. But even if science provides the methods of birth control, mankind has to be persuaded to accept them. This involves overcoming superstition and religious objections as well as educating thousands of millions of people. In the meantime, the world's economists must be concerned in increasing the world's food supply to prevent over 30 million people dying of starvation every year. Scarcity can be decreased given a better distribution of the world's
There are prophets of doom. In a lecture given in the USA in 1968 and published by Oxfam in the UK in 1970) predicted a major catastrophe in the world before the end of the century because of the food population collision. Lord Snow contended: "We shall, in the rich countries, be surrounded by a sea of famine, involving hundreds of millions of human beings." Can we prevent Malthus from being right, in the long run?
The immediate problem-to feed the population
The short-term problem is to feed the starving millions, and to ensure a better distribution of scarce resources so that millions in Asia, Africa, and Latin America have the opportunity to live a reasonable life. Karl Marx did not accept the inevitability of overpopulation problems, because to him the basis of wealth was labour; the greater the population, the greater would be the world's wealth. Marx accepted the subsistence theory, but rejected the principle of population on which it was founded. For Marx, wages could not rise because, under a capitalist system, the power of employers was so great that wages would always fall to a subsistence level, since the landless proletariat, having no other means of earning a living, must accept whatever wages were offered. The answer to farming. the population explosion, according to Kari Mars would be the obliteration of capitalism and the effective distribution of this world's goods
U. Thant, when Secretary General of the United Nations, said that: Hunger is a world problem no less urgent than the threat of nuclear destruction." We are still in a situation where one in five of the world's population is threatened with starvation. There are many ways in which the present problem of malnutrition can be mitigated:
- There could be an increase in the cultivable areas:
- Soil conservation by contour ploughing and re-afforestation with trees such as eucalyptus.
- irrigation on a gigantic scale, as practised in the Middle East, where pipelines have been laid through the desert and in Egypt, where the Aswan Dam has been a major project. The desalination of sea-water offers great potential since oceans cover over two-thirds of the world's surface.
- Better distribution of the world's resources: we are falling behind in the attempt to feed mankind, mainly because as the rich grow richer, the poor grow poorer.
- Animal protein (e.g., from the red kangaroo) ought to be utilized to a larger extent. The Far East, Latin America, Africa, and other parts of the Third World are suffering from a serious deficiency of animal protein. There are specific deficiency diseases such as the eye disease (from which one-sixth of the world's population suffers), beriberi. goitres, etc., whereas resistance to other diseases may be lowered by malnutrition, eg, in the case of tuberculosis, malaria, yaws. leprosy, sleeping sickness, etc.
- The least developed countries require capital equipment and technical aid. This may be in a variety of forms, ranging from advice on agricultural methods to an increased quantity of consumption. tractors, bulldozers, and agricultural machines. Food parcels only bring temporary alleviation. People in emerging nations must be taught to help themselves.
- A Green Revolution with greatly increased yields has been attempted by improving genetic strains, fertilizers, and large-scale scientific farming.
- Different types of crop are a necessity; there are about half a million botanical species, but humans cat only a few hundred varieties. People U Tham, when Secretary General of the United are so faddy that it is difficult to get them to try anything but a conservative diet. Soya beans contain more protein than any other crop, but few needy nations have shown much interest in increasing the production of protein-rich crops such as beans and peas In underdeveloped countries, grains are the major source of food and cereals provide the main food surpluses, when what is mostly required is an expansion in the production of foodstuffs with a far richer protein content
- Traditional anti-social habits, superstition, and ignorance must be fought where they have a deleterious effect upon the food supply. More than half of India's cattle are disease-ridden, but revered as sacred. Many people in the world will not eat pork because of religious scruples: yet the pig is one of the most efficient producers of animal protein.
- The development of more effective pesticides must be undertaken, hand-in-hand with a des termination to observe carefully the importance of the balance of nature. Insects destroy nearly one-quarter of all food produced and it has been calculated that a swarm of locusts can consume as much in a day as 100,000 people can cat during the same period.
- Fish farming, intensive fishery research, and the use of new fishing grounds in the deep waters off Africa and India are all possibilities. If the annelid catch of 50 million tonnes of fish was even doubled, a valuable source of cheap protein would be available. International action ought to be taken to control the huge factory ships which indiscriminately scoop the sea for both large and small fish. The oceans contain enormous quantities of protein-packed algae which the Japanese have made palatable for human
- Industrialized animal production can be ex fended. Moral scruples have to be faced, but it cannot be denied that battery-reared poultry provides a cheaper form of protein than red mot Reading methods adopted securely with poultry would be carried out with many animals.
- More synthetic foodstuffs are in the pipeline. Protein may be extracted from deshells. This would entail a woman producing a child about every two years, allowing for gestation weaning, is an especially rich source of nutrients.
The long-term answer-to control population growth
The dangerous implications of the population explosion must be appreciated by people the world over. Hem in sapiens (unthinking man) in these matters must be made to realize that population problems are likely to be more of a danger than nuclear problems, because the latter are simpler to control. A few thinking men may prevent nuclear destruction but the population problem has, by necessity, to be the responsibility of millions of people. International organizations and world governments can help publicize the problem and advocate remedies, but the long-term answer lies with humanity with people rather than with institutions.
In order to consider comprehensively the world population problem and the possibility of finding a centennial long-term solution, it is necessary to examine the population explosion in retrospect. We must understand the underlying causes, if we are to find the answers. Professor Carlo Cipolla, in The Economic History of World Population ( at world population problems can only be said they are studied in historical perspective
The population mechanism, in the natural seventeenth century, the birth rate was about per 1000, the population increased very gradually by about 0.2 per cent a year. The fast population explosions began among the white people and the spread to other races, is partner to the Asians and South Americans
The main reason for the excessive increases in population is the lengthening of what demographers term the expectation of life at birth
The revolutions in medicine, transport, agriculture, and industry all contributed to the population explosion The expectation of life in eighteenth century Britain was about 25 years. The greatest toll of life was in the early years the infant mortality rate, ie, death before the age of one year, was 250 per 1000 in 1750 compared with 14 per 1000 in 1980 The Victorian attitude, that it was a stigma if one could not fill the family pew with a 'quiverful of children, gradually changed as Britain moved from a rural to an urban society. Whereas in 1770 about per cent of the people lived in the country and farmed the land. by 1870 the typical Englishman was a townsman, and by 1900 he was an industrial worker. This trend was followed in other European countries and the USA. The importance of this change to an economy based upon industry and services, rather than upon agriculture, cannot be exaggerated
The number of those, to whom the classical economists loosely referred as "non-producers, that a society can support depends largely upon the efficiency of those engaged in agriculture industries. In the UK, the 2.5 per cent of the population who were engaged in agriculture in 1980 were able to produce food for about 30 million people out of a total population of about 56 millions. In India, about 80 per cent of the people are primary producers and support the remaining 20 per
As more people in the industrial societies moved into the towns, the birth rate began to fall (see Fig. 4.2) Children are absorbed comparatively easily into an agriculturally based economy. Compulsory education transposed the role of children from that of economic aids to economic burdens
Towards the end of the nineteenth century, the British birth rate began to fall: people were attempting to maintain a higher standard of living than was conceivable in previous centuries. Obviously, if two families enjoy the same income, and one family has two children and the other six, the general standard
There has also been a reversal of past trends in supporting large families in urban and rural com-. munities. Demographic statistics for many urban areas show that the population growth is about double that of rural areas. This has been caused by such factors as overcrowding (which may prevent the seclusion necessary for effective family planning) and illegitimate births combined with promiscuity in a permissive society.
The problem of the population explosion has become a world-wide one because the demographic trends first experienced in industrial societies have overtaken the underdeveloped countries. Conditions that took two or three centuries to develop in Britain have been superimposed all too rapidly elsewhere. How can the world cope with population increases of this rate? It has taken half a million years for the human race to increase to about 3500 million, but in 30 years this figure may have doubled The most gloomy and possibly most realistic of the neo Malthusians argue that hundreds of millions of these people will never survive the population explosion. It is generally recognized by demographers that there is a cycle of population changes Countries usually follow four stages in a fairly regular pattern (see Fig 4.2)
The UK has recently experienced a period of almost zero-population growth In 1975, the birth rate was slightly less than the death rate, but it is of living of the first family is bound to be higher, projected that the birth rate will slightly exceed the death rate, until the end of the twentieth century.
The optimum population
The optimum population is generally regarded as that population of a country which, when combined with the other factors of production (land, capital, and organization), gives the maximum returns per head. Some economists continue the use of the term optimum population to that population which results in the maximum output of the country, the phrase 'per head' introduces ideas of distribution of the returns to the factors of production and as economics is concerned with welfare as well as with wealth, it is reasonable to consider output per capita. This is not the same as stating that output will be, or should be, evenly distributed. Indeed, in some years, port, medicine, education, etc. The optimum criterion may appear unsatisfactory to the statistician but the concept of an optimum level is a realistic approach to population problems, to an economist the number of people is less important than their ability to utilize the land and capital available. At a particular moment of time, there is an optimum population where the average product per head will give the people of that country the highest standard of living currently possible. In Table 4.1 the optimum population would be 50 million
Table 4.1 The optimum population
(millions of units)
and health standards of the population will affect the optimum size. Other points to be considered in the modern world are whether or not a country has attained a "take-off point of economic progress (see Fig. 4.4), the amount of technological know-how, foreign aid, and the country's export-import position, W. W. Rostow, in The Stages of Economic Growth, suggests that "The whole southern half of the globe plus China is caught up actively in the stage of preconditions for take-off or in the take-off itself.
The great advantage of the optimum concept over the Malthusian subsistence theory is that the optimum is both a relative and flexible concept, and does not necessitate an attitude of condemning man to live at subsistence level. The optimum population level changes constantly according to the development of resources, technology, science, trade, trans-
While we have seen that the population of India is apparently high for the eighties, economic development may well mean that this huge country will be able to feed far more people in future years and that the increased number of people will enjoy a far higher standard of living than is experienced at the moment. Countries with populations below the optimum include Australia and Canada. Australia would be able to support a far larger population if she were able to increase her fresh water supply by the desalination of sea water. In the eighties, the UK probably has a population of about optimum size No doubt, the UK will be able to support comfortably the projected population of about 60 mil lion by 2001 AD (see Fig 4.5), but the great advantage of the optimum concept is that we do not limit our thinking to definite or specific numbers that a country can support at a miserably low Malthusian level. Britain could certainly not have supported 50 or 60 million people when the first census was compiled in 1801. A study of economic history (an invaluable asset for economists), indicates that 9 million was possibly an excessive number considering the economic development of Britain at the beginning of the nineteenth century.
At that time, it would have seemed inconceivable that Britain could support a population of 56 million. But conditions changed: the spread of scientific agriculture plus the large-scale importation of foodstuffs meant that a new optimum has emerged. The optimum is not an absolute number Where a country is overpopulated there are two simple remedies: the optimum level could be reached either by decreasing the total population, eg, by family planning, or by increasing the supply of other factors that make for the maximum output per head Our study of world Development Association (IDA) population problems indicates that both these remedies should be used, particularly in Asia, Africa, and South America. Population growth should be controlled while, at the same time, aid should he given to less developed countries in order that they might learn to help themselves
Some economists have argued that there is a ceiling beyond which an economy cannot grow. However, apart from population growth there is little else that is "natural' or 'given. The optimum concept leads us to believe that economic growth is flexible and that there are a number of mechanisms that will raise the ceiling. For example, improvement in education can lead to an increased and more: efficient labour supply, while research and development can lead to advanced industrial knowledge and an improvement in the quantity and quality of material goods.
Aid to less developed countries
Underdeveloped countries do not enjoy an optimum population level in terms of max output per head. Usually the population is too large compared with the current ability to utilize the other factors of production, and there is a tendency to place too much reliance upon primary products. The situation of these countries is worsened if they depend too much on one or two commodities, as Malaysia Based upon tin and rubber, with little diversification Ale the terms of trade, i.e., the relationship between import and export prices, may work against the less developed countries. Foreign aid should be given for predictive purposes. In the power-struggle between the superpowers, capitalist countries and communist countries have vied with each other to disburse aid in order that they might exert political influence UK's foreign aid began with assisting territories that were dependent on us, and a large proportion of our aid still goes to Commonwealth countries. There are five main ways in which the UK gives foreign aid:
Apart from the UK, many other countries provide foreign aid on a relatively large scale. The USA began her gigantic foreign aid programme with the Marshall Plan that was intended mainly to help European countries suffering from the aftermath of the Second World War. American aid has taken on a global pattern, especially as she was uninhibited by nineteenth-century imperialist ties. During the last 25 years, however, this aid has taken on a new 'imperialistic' pattern and economic assistance has largely been given to those countries fighting against infiltration.
The problems of an increasing population
Most countries, in the twentieth century, are faced with multifarious problems brought about by in creasing populations. Whether or not an increasing or decreasing population is likely to be advan tageous or disadvantageous depends on the current population of the country in relation to the optimum. level. Even if a country is overpopulated by present standards, the development of related factors may mean that the country can sustain an increased economic growth rate so that the increased popu lation will have an improved standard of living As we have seen, the optimum is a relative concept and even in countries such as China, limited population
European countries have given most aid measured on the basis of a percentage of national wealth (see Table 4.3). Western Germany's aid has been to some extent determined by her desire to expurgate herself in the eyes of the rest of the world from crimes increases could prove beneficial. perpetrated by two twentieth-century wars. France has concentrated her aid upon one-time French colonial territories in Africa. The members of the EEC have been relatively outward-looking; al- though the EEC has been charged sometimes with neo-colonialism, this charge has been refuted by the willingness of the African countries to renew the Association upon gaining independence.
The economist has to be wary of the accuracy of development plans Underdeveloped countries ought to attempt to ensure that plans for economic projects are possible to complete Clearly, popula tion projections figure largely in this matter, and a study of UK experience indicates the dangers in herent in erroneous population forecasts Examine Fig. 4.5 and the League of Nations population.
Table 4.4 League of Nations UK population project projections 1950 to 1970
(for which projection was made)
Table 4.5 UK birth rate per 1000 of the population 1880 to 1979
The Royal Commission on Population (1945-49) also forecast that the population of the UK would begin to decrease in the seventies. This was based largely on the steadily falling birth rate from 1880 to 1940 (see Table 4.5).
The size of the average family has fallen from about seven or eight in Victorian times to just over three today. Family allowances (child benefit allowances) were introduced in 1945, partly in order to increase the birth rate. However, the projections were proved wrong following the postwar population 'bulge', and the trend towards slightly larger families that accompanied increasing affluence. If it is regarded as antisocial to have more than three children in an overpopulated world perhaps all children after the third should represent a tax burden to the parents. A country with an increasing population is faced with difficulties, but in the long run it has many advantages:
- A young population If there is an increasing proportion in the younger age groups, eg., Brazil has 50 per cent of her population under 19 years of age, then there is likely to be a flexible economic system. Young people have more virility, enterprise, and greater labour mobility. Changing fashions and trends mean that there will tend to be an increasing demand for economic goods. Older people are not prone to accept change, however necessary, and the elderly cost more in the way of social services; pensions constitute the largest item of social service expenditure in the UK.
- An expanding economy An increasing population is often associated with an expanding economy. Fuller advantage may be taken of existing resources and a desire for more technical know how will be prevalent
- Incentive for innovations There will be a need for more capital expenditure in the form of factories, houses, educational institutions, hospitals, means of transport, ete Therefore, there will be a great incentive for innovations
- Influence and prestige Although political in- fluence and world prestige, associated with an increasing population, are not solely economic factors, they have a direct effect upon a country’s economy economy.
- Sharing of the National Debt A larger population means more people to bear the burden of the National Debt. If due allowance is made for depreciation in the value of money, it can be argued statistically that the UK National Debt is less of a burden per capita today than it was before the country. Second World War.
- Increase in exports A country with an increasing population will usually attempt to increase its exports (in order to pay for the necessary extra imports). This is likely to lead to increases in skill, specialization, etc.
There may be, however, disadvantages in an increasing population:
- Less space There will be less land per head, and if the country's population is already approximating to an optimum level then the price of land for housing, factories, etc., could rise excessively. This has happened particularly in the UK and Japan
- Congestion Congestion, not only of people, but also of transport, may prove very costly to a country with an increasing population.
- Pollution Most pollution problems arise from the increasing number of preoptic disposing the waste materials associated with a modern economic society. The noxious emissions of increasing members of aircraft and motor vehicles pollute our atmosphere. The uncontrolled pollution of British estuaries and coastal areas by sewage and industrial waste was severely criticized in the Introductory Report of the Royal Commission on Environmental Pollution. These pollution problems have now had to be dealt with by legislation both here and in the US
- High fluctuating population Until the seventeenth century, the normal situation was one of a high birth rate and a high death rate, resulting in an exceedingly slow and irregular increase in the population.
- Early expanding stage In the eighteenth century in Western Europe (and at a later date through out most other countries of the world), the death rate fell rapidly but the birth rate remained comparatively stationary. The population rose steadily as the birth rate (about 35 per 1000) exceeded the death rate (about 20 per 1000)
- Later expanding stage Although the death rate (continued to fall, the birth rate also fell rapidly, e.g.. in Britain after 1880. Population increases were sure and steady.
- Low fluctuating stage The birth rate and death rate curves on the graph almost meet (see Fig. 4.2). but the death rate stays below the birth rate.
- Bilaterally In the form of loans, grants, etc. This is the main form of aid (see Table 4.2)
- Multilaterally Through the International Bank for Reconstruction and Development and its two main associates, the International Finance Corporation (IFC) and the International
- Through the CDC The Commonwealth Development Corporation (CDC) was established in 1948 to operate as a commercial organization promoting and investing in development projects that will both help the Commonwealth countries and yield a reasonable return on the money invested..
- Through capital exports The UK is one of the most important capital-exporting countries on a private basis. The Commonwealth Development Finance Corporation (CDFC) was established in 1953 to assist in the financing on a commercial basis, of sound productive developments
- Through charities Charities, such as Oxfam must not be dismissed too lightly. Although their contribution may be relatively small, nevertheless the charities are evidence of a real desire, by hundreds of thousands of individual citizens, to help the poorer nations.