Saturday, February 18, 2006

Will most human populations -> zero?

Some population facts:

Japan, with 127.1 million people is the world's 9th most populous country. Its total fertility rate (TFR) is 1.3 births per woman, much lower than replacement and, because it does not seek migrants, Japan's population growth rates will inevitably diminish as the gap between births and deaths narrows. If trends of the last few decades continue, the population will decline after 2015 to perhaps 101 million by 2050 (here) or even as low as 92 million or 72% of its current level (here). At this rate Japan's population would converge hit 60 million, less than 50% of its current level, by 2100 (here).

Other countries show even bigger projected population declines: Italy by 22% and a slew of eastern European countries, including Russia and Ukraine, will see populations crash by between 30-50% to 2050. Indeed recent UN projections suggests most countries will approach a TFR of 1.85 children per woman. This type of forecast represents a real break with past thinking - demographers had always assumed countries would settle down to replacement fertility levels (here) . Now the presumption is for a long-term sustained decline in human population. Apart from African and Latin American countries, whose populations will increase dramatically during the 21st century, the populations of most countries will start to disappear.

This sounds like fiction and it very likely is? But if such outcomes are implausible we should try to understand the economic factors that might increase fertility by offsetting these trends.

Some guesses:

  • As populations age and children become scarcer, kids will become more valuable so more will be produced. Not entirely convincing as these types of 'scarcity' benefits are external benefits - people are still left with the private costs of raising children.
  • Certain types of fixed assets such as land will become cheaper as population declines increasing disposable incomes that can be spent on children.
  • Certain health or education costs might decline but others might increase - especially those which benefit from scale economies.
  • Young adults might become more valuable in labour markets as labour shortages intrude thereby cutting net parental costs of supporting them and inducing higher fertility.
  • Female labour participation rates will asymptote to some lower bound limiting rises in the opportunity cost of having children. Perhaps there will be sociological changes that make women or men happier to be stay-at-home carers rather than workforce participants.
  • Finally, there might arise a batch of pro-natalist government policies, triggered by the desire of governments to produce enough young bodies to take care of aged populations.

My own view is that some of these factors will operate to thwart declining population trends as forecast by groups such as the UN. If these offsetting changes only come into operation when global populations are low then we will have to learn to live with much lower human populations. Finally, it is conceivable, though unlikely to me that perhaps African and North American populations will continue to grow thereby eventually dominating the globe. My hunch is that, longer-term, these countries will mimic current developed country fertility trends just as Asian developing countries have.

It is interesting that the environmentally-based 'population bomb' scenarios of the 1960s and 1970s are now replaced by fears of population decline with consequent economic costs . Such vacillations in attitudes towards population have occurred throughout history. My concern is that worries about population decline will drive misguided policies in much the same way that misjudged concerns about the environmental impacts of population, and vulgar Malthusianism, drove inept policies in the 1960s and 1970s.

Udate: A version of the question posed here was subsequently asked by Fraer Nelson, 'Where have all the babies gone?' in the The Spectator, here. I quote very selectively below:

'The last European will die on 6 August 2960. This, if you extend demographic trends far enough, is the grim official prognosis for our continent. We are rich enough and clever enough to have separated sex from childbearing and too busy for large families. The birth rate dropped below population replacement levels years ago, and our population increase is being driven by immigrants and older age. But even this won’t last. Soon we will start a long but comfortable slide to extinction.

... Sooner or later, political debate will catch up with the demographic reality — which is that Europe will soon start to empty and is already becoming the granny flat of the world.

...The European Commission has produced a report looking at population trends to 2050 and is warning that the head-count will peak within three decades. But the gentle population fall, it says, will mask a pernicious drop in working-age population that will cause ‘severe financing problems for social welfare systems’. Today, four workers support each pensioner; this ratio will soon halve. The elderly may be drafted in to man the factories, and soon the immigrants will go native and stop breeding. .....

....No one had grasped the real implications of the sexual revolution in the 1960s.
The Pill may have transformed women’s sex lives, but the new era of cheap and reliable contraception had its biggest effect in the bedrooms of the happily married. Once couples could afford effective family planning they used it, and this was what slammed the brake on Europe’s childbearing record. ....

....Abortion is illegal in Ireland, and widespread in the rest of Europe. Figures for England and Wales show that one in four healthy pregnancies now ends in a termination. So in the rich world, the declining birth rate is driven not by biological factors — or fertility, as commonly understood — but by a lifestyle choice which does not exist for the developing world. ....

But children make economic sense in the Third World...In places with no welfare state, children are seen as walking pension policies; on farms, they are labourers. But even in the poor world, this is changing. This year urban-dwellers become the majority for the first time in history.....

As soon as people can afford to, they cut down on the number of children they have. This is why the UN’s low-fertility scenario predicts that, as globalisation continues and poverty is steadily conquered, humanity will peak at 7.75 billion in 2040. The decline soon accelerates: follow the demographic formula through the centuries and it points to the extinction of humanity in about ten millennia — having survived on the planet for far less time than the dinosaurs. Mankind may yet end up being a blip on the history of the planet, and Europeans a micro-blip. (my emphasis)

....The public, meanwhile, has little reason for alarm even if the forecasts do come true. As long as the economy shrinks at a slower rate than the population, there will be enough wealth for those who remain, and Europe will grow old beautifully — safe in the knowledge that the rest of the world is not too far behind.

Read the full Sex and Society survey at


Anonymous said...

Is it the case that there are no efficiency grounds for intervening in fertility? A quick (half-awake) thin brings just one - if the supply of innovation is connected to size of the population (innovation as a random process) - even though I don't find this hypothesis convincing. If anything congestion etc may decline (though there are probably not efficiency grounds for negative intervention a la Logans Run)? Though probably more than clucky about other peoples babies than the next person, am not sure this is grounds for intervention.

hc said...

I think a lot of standard welfare economics goes out the window when considering population decline because, in many instances, scale economies are being lost. FIn reverse, the existence of population growth led to the existence of population agglomerations (cities) creating the basis for higher education, efficient water supply systems and so on.

There are strong distributional arguments for moving to a lower population gradually that relate to population aging effects.

I assume you mean 'Logan's Run' the movie - I'll take a look at it.

Anonymous said...

Thank you for your response, which was interesting - Logans Run (the movie, and tv series) is one a series of 70s science fiction dystopias (Soylent Green, Planet of the Apes, Westworld) - probably no better or worse than these - in some sense a mirror of Taxi Driver (and other collapsing New York films - though not as good as Taxi Driver it should be said) in their view.

hc said...

Soylent Green is interesting. Its the first time I have seen reference to a FGreenhouse effect in the media. Good movie too.

Sam Ward said...

Harry: isn't it true that the decline in fertility goes hand in hand with the existence of a welfare state?

In times gone past children were not only a blessing but also a retirement plan, in that the young were expected to care for their parents in their later years.

This is still very much the case in developing countries with no welfare state to speak of, and these countries are still producing children.

When the welfare state reaches it's inevitable bankruptcy, I think it is reasonable to predict that children will once again be high on many peoples' priority list.

hc said...

That's a good point Sam. Kids as a substitute for social security (or the other way around). Also capital markets as a substitute for kids.

But these things are entrenched - they won't go away unless the state goes bankrupt and, no, I don't think it will. But you are right, if they did, kids would become important again.

It would be interesting to test your theory by checking whether low fertility rates are correlated with low social security. Eventually, perhaps, watch this space.