Objectives

This essay has three objectives, each designed to improve understanding and promote discussion. The first is to briefly review recent findings of economic research on the relationship between population growth and economic development. These we organize by major categories of economic activity, indicators of how goods, services and opportunities are distributed; and by categories of assets, material or nonmaterial resources of utility and value. Our second objective is to review an economic perspective on population growth that has dominated the field for the past decade. The scholarly literature on this issue labels this view, which stresses the mixed and ambiguous impacts of population growth on economic change, revisionism. Here we briefly outline the conclusions of this school of thought as expressed in an overview of the population-economic links published in 1986 by the U.S. National Research Council.2 In addition, we discuss more recent studies that tend to support the thesis that population growth affects economic change and that point to the need for further research.

Our third objective is to challenge some of the assumptions that underlie the revisionist view. Here we focus on modern institutions, which are socially organized structures, laws or customs such as competitive markets, property rights, and government policies and programs. Current revisionist literature rightly celebrates the capacity of modern institutions to adapt to change and other stresses. We argue here that this perspective nonetheless still lacks an understanding of precisely how institutions facilitate economic adaptation to growth and to the subsequently expanded demands of a larger economy.3 We note that adaptation to recent population growth has been costly. Often it has been gained at the expense of long-term human health status and environmental assets, and sometimes with an increase in social inequity. And we suggest that two inherent characteristics of institutions‹limitation and bias‹are responsible. We argue that these institutional shortcomings, which can be reduced but never eliminated in humanly imperfect economies, merit consideration when projecting the likely economic impacts of current and future population growth.

In brief, two arguments dominate this paper: One, the body of economic research supports the claim that slowing population growth tends to have positive economic impacts in modern developing countries. Two, economic research fails to capture all the economic benefits of lower rates of population growth because it does not account for the high cost of adjustment‹even successful adjustment‹that modern institutions make in response to ever higher population size and accompanying stresses.