Worldwide Practices: Population Growth for Economic Expansion

Population growth in a country leads to economic growth, but how can we harness that into a long-term strategy we can all share for achieving economic expansion while reaching for individual sustainable prosperity?


| April 2014



Italian houses and landscape

Numerous economic studies show that the most prosperous countries generally have slower rates of population growth, a phenomenon called the "demographic-economic paradox." It's a paradox because a lot of wise people, including Thomas Robert Malthus, have theorized that prosperous societies will have more children because they can afford them. Not so, apparently.

Photo by Fotolia/José Luis Sánchez Ma

Humanity is at a turning point. Only one species in the universe can recognize its own impact on its habitat, so far as we know, and we are that species. In Beautiful and Abundant (B&A Books, 2010), Bryan Welch discusses the challenge the human population must face—sustaining our quality of life on this miraculous, but finite sphere we call earth. The following excerpt from Chapter 7, “The Big Ponzi,” discusses the relationship between economic growth and human population growth.

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In Italy, the human population is officially stable. According to the U.S. Census Bureau, which keeps track of populations around the world, Italy gained about a million people between 1995 and 2005, but has now stabilized around 58 million legal residents.

Likewise Spain. Spain's official population is projected to be stable around 40 million people for the foreseeable future. Germany is steady at 82 million. And Finland. Stable at about 5 million people.

Numerous economic studies show that the most prosperous countries generally have slower rates of population growth. Economists have even given the phenomenon a name. They call it the "demographic-economic paradox." It's a paradox because a lot of wise people, including Thomas Robert Malthus, have theorized that prosperous societies will have more children because they can afford them. Not so, apparently.

As developing nations achieve a certain level of prosperity, the health and education level of their citizens improves. When a society improves health and education—for women, specifically—the birth rate falls. Prosperous people recognize the incentives for raising small families. In more prosperous countries, the quality of life is determined more by the family's overall level of education than by the number of laborers in the household. And affluent people in the world today are reasonably confident that all their children will survive to adulthood. In poor countries with high childhood-mortality rates it makes sense to hedge your bet on your offspring by having more of them.