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Social Sci LibreTexts

18.2: Population Growth and Economic Development

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  • Learning Objectives

    1. Explain the relationship between population growth and the rate of increase in per capita income.
    2. Summarize Thomas Malthus’s reasoning that led to the concept of a Malthusian trap, and explain why his dire predictions have not occurred in many countries in modern times.
    3. Explain what is meant by a demographic transition, and describe how it has proceeded in very different ways in developed versus developing countries.

    It is easy to see why some people have become alarmists when it comes to population growth rates in developing nations. Looking at the world’s low-income countries, they see a population of more than 2 billion growing at a rate that suggests a doubling every 31 years. How will we cope with so many more people? The following statement captures the essence of widely expressed concerns:

    “At the end of each day, the world now has over two hundred thousand more mouths to feed than it had the day before; at the end of each week, one and one-half million more; at the close of each year, an additional eighty million. … Humankind, now doubling its numbers every thirty-five years, has fallen into an ambush of its own making; economists call it the “Malthusian trap,” after the man who most forcefully stated our biological predicament: population growth tends to outstrip the supply of food” (Appleman, 1976).

    But what are we to make of such a statement? Certainly, if the world’s population continues to increase at the rate that it grew in the past 50 years, economic growth is less likely to be translated into an improvement in the average standard of living. But the rate of population growth is not a constant; it is affected by other economic forces. This section begins with a discussion of the relationship between population growth and income growth, then turns to an explanation of the sources of population growth in low-income countries, and closes with a discussion of the Malthusian warning suggested in the quote above.

    Population Growth and Income Growth

    On a simplistic level, the relationship between growth in population and growth in per capita income is clear. After all, per capita income equals total income divided by population. The growth rate of per capita income roughly equals the difference between the growth rate of income and the growth rate of population. Kenya’s annual growth rate in real GDP from 1975 to 2005, for example, was 3.3%. Its population growth rate during that period was 3.2%, leaving it a growth rate of per capita GDP of just 0.1%. A slower rate of population growth, together with the same rate of GDP increase, would have left Kenya with more impressive gains in per capita income. The implication is that if the developing countries want to increase their rate of growth of per capita GDP relative to the developed nations, they must limit their population growth.

    Figure 19.2 “Population and Income Growth, 1975–2005” plots growth rates in population versus growth rates in per capita GDP from 1975 to 2005 for more than 100 developing countries. We do not see a simple relationship. Many countries experienced both rapid population growth and negative changes in real per capita GDP. But still others had relatively rapid population growth, yet they had a rapid increase in per capita GDP. Clearly, there is more to achieving gains in per capita income than a simple slowing in population growth. But the challenge raised at the beginning of this section remains: Can the world continue to feed a population that is growing exponentially—that is, doubling over fixed intervals?

    Figure 19.2 Population and Income Growth, 1975–2005


    A scatter chart of population growth rates versus GNP per capita growth rates for various developing countries for the period 1975–2005 suggests no systematic relationship between the rates of population and of income growth.

    Source: United Nations Development Program, Human Development Report 2007/2008 (New York: Palgrave Macmillan, 2007).