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conclusion of population growth and economic development

There is an extensive literature on these relationships but little consensus on the actual effects of population on economic growth (Heady & Hodge, 2009). Wages are higher, so consumption tends to be higher as well. But if economic development can slow population growth, it can also increase it. By the mid-1700s, Great Britain had developed into a commercial and military powerhouse; meanwhile, the population rose dramatically in Britain’s North American colonies. Today, an international consensus has been reached. a. Conversely, poor and probably uneducated members of the society have high fertility rates implying that they have many children who join vicious cycle of poverty (Lee 2003, p. 75). Diminishing returns may become a serious problem if population growth is rapid. For 2017, the value of all goods and services produced by Wisconsin workers was $313 billion. Privacy Policy3. Business activity will be spurred as a consequence. TRINITY INSTITUTE OF PROFESSIONAL STUDIES Sector – 9, Dwarka Institutional Area, New Delhi-75 Affiliated Institution of G.G.S.IP.U, Delhi B.Com (H) Indian Economy 888301 Population and Economic Development By Dr Vandana Malviya… And growing incidence of poverty is the root cause of environ­mental degradation. Lee, D 2003, ‘The Demographic Transition: Three Centuries of Fundamental Change’, Journal of Economic Perspectives, vol. A growing population, within a limited geographical area, usually puts heavy pressure on the existing factor endowments, especially natural resources of the country. IvyPanda. "Relationship between Population and Economic Growth." But, to show how rapid population growth retards economic development, it is necessary to mention that by economic development we mean not only increase in national income (GNP) or per capita income, but also reduction in unemployment as a result of the growth of employment opportunities and reduction in poverty and inequalities of income. No one should exaggerate either the beneficial or the unfavourable effects of population growth on economic development. Although, it is possible that the effect of population growth on economic development has been exaggerated, or that no single generalization is justified for countries differing as widely in growth rates, densities, and income levels as do today's less developed areas. 1. If you are the copyright owner of this paper and no longer wish to have your work published on IvyPanda. Population growth plays a conflicting role in the development process of a country. Your privacy is extremely important to us. It is controversial. Authors; Authors and affiliations; Amarjit Kaur ; Chapter. Secondly, based on the Indian experience, Ansle Coale and E. M. Hoover drew attention to the likely adverse effects of population growth on savings and capital formation through the following effects: the age-dependency effect, the capital- swallowing effect, and the investment diversion effect. The experiences of Korea and Taiwan tell that economic development in these countries proceeded successfully despite high population growth. 2019. Welcome to EconomicsDiscussion.net! This will not only lead to high rate of dependency but also high cost of caring for the aged populace (Weil 2009, p. 87). It alludes to considerable rise in per-capita national product, over a period, i.e. McCulloch, N & Baulch, B 2000, ‘Simulating the Impact of Policy on Chronic and Transitory Poverty in Rural Pakistan’, Journal of Development Studies, vol. Secondly, a growing population means a growing market for most goods and services and we know that division of labour is limited by the extent of the market. 19-94. In fact rapid population growth has been obstructing economic growth in developing countries like India where since 1951 population has been growing at a relatively high rate. Thus, the migration of the productive farm workers in other sectors needs to be attributed to the policy failure and not to the population pressure. It is important to highlight that high population density may also lead to environmental degradation and other effects of overutilization of resources. By designing their development programmes, LDCs can raise their levels of income and living standards. No doubt rapid population growth in the face of low total factor productivity is the root cause of poverty in most LDCs. And more income and employment will be created in the process. In the long run, ARDL results show that the population growth has a positive and statistically significant impact on economic development. According to Kuznets, the identifying characteristic of "modern economic growth" is a. expansion of heavy industry. 27 no. Environmental issues and … A vigorous debate on the relationship between those two factors has been going on in all countries, irrespective of whether they have less developed economies, developed economies or transition economies. Colonial Growth and Expansion. Economic growth is dependent on a wide array of factors that range from technology to capital. Sir William Petty presented an optimistic outlook on population growth. Of course the size of the domestic market of country does not only depend on the number, but also on the per capita income level. It was believed that if you want to lower the fertility rate, then improvements must be made in mortality. As elucidated by Kohler & Kohler (2002, p. 56), high rates of population growth as witnessed in many African countries will lead to unsustainable economic development and growth. Population Growth and Economic Development of a Country! Some authors offer theoretical arguments and empirical evidence to show that robust population growth enhances economic growth while others find evidence to support the opposite conclusion. While some economists postulate that economic development slows down in periods of high population growth rates, others argue that high population growth boosts economic growth. Share Your PPT File, Effects of Economic Development on Population Growth. Age structure data allow the rate of growth (or decline) to be associated with a population’s level of economic development. Finally, neo-Malthusians argue that excessive population growth and massive poverty in LDCs have greatly damaged the ecological balance by deforestation and land degradation. The sheer arithmetical increase in population creates work as well as incentives for production that impacts upon output and productivity quite favourably. On the one hand, age structure in industrialized nations is major cause for skewed relationship between population growth and economy (Aliber 2001, p. 36). The rationale is that population grows in geometrical way while productivity improves in an arithmetic rate. Under the circumstance, the capital-shallowing effect may remain inoperative. Various economic models have attempted to establish the relationship between different demographic dynamics and economic growth (Barro 1991, p. 87). In such countries as China and India, the high rate of population growth has complemented economic growth rate (Drèze & Sen 1995, p. 38). The relationship between population growth and economic development has been a recurrent theme in economic analysis since at least 1798 when Thomas Malthus famously argued that population growth would depress living standards in the long run. However, this argument is a faulty one. 45-134. 3, pp. On the some vein, the then Prime Minister Mr. Pitt of England dec­lared in the 18th century: “A man could enrich his country by producing a number of children, even if the whole family were paupers.” All these suggest that not only there is no conflict between population growth and economic development but also an increase in population is necessary for increase in wealth and development. Indeed, this argument is empirically important in addition to theoretical reasoning. the growth rate of increase in total output, must be greater than the population growth rate. However, Mlthus ‘ argument came under severe attack at the hands of Karl Marx and F. Engles. It alludes to considerable rise in per-capita national product, over a period, i.e. This implies that population growth in income unequal countries is not only detrimental for the economy but it also threatens social stability. GDP is a measure of the national income / national output and national expenditure. It may also lead to deforestation and increased degradation of natural resources. For instance, countries that experience high rates of income inequalities exhibit fertility discrepancies between poor uneducated people and rich and literate people (O’Sullivan 2003, p. 57). It is because of ‘natural limits’ in agriculture population growth would overtake food supply output, thereby leading to famine, hunger, malnutrition, etc. “Economic development is sustainable if, relative to its population, a society’s productive base does not shrink.” (Dasgupta, P. 2008) The more you earn in terms of wages, the more you tend to buy. December 21, 2019. https://ivypanda.com/essays/relationship-between-population-and-economic-growth/. In contrast, a thickly populated country with a small population base such as Sri Lanka seems to be especially handicapped by the all size of its domestic market. Actually speaking, as the rate of growth of population exceeds the rate of production, economic development is hampered. When the number of dependents or the ratio of consumers (non- producers) to producers increase, there occurs a diversion of income from savings to consumption and a fall in per capita income. We utilize security vendors that protect and ensure the integrity of our platform while keeping your private information safe. However, fertility rates are dependent on incomes, literacy and inequalities that typify an economy. This analytical essay on Relationship between Population and Economic Growth was written and submitted by your fellow student. Abstract: The connection between population growth and economic development has been a much debated topic ever since the world population passed the two billion mark. Growth increases with GDP reaches its maximum and then begins to decline. Disclaimer Copyright, Share Your Knowledge Population density is another parameter that theorists use to establish correlation between population growth and economic growth. In recent years, as agriculture is becoming more and more unprofitable, the issue of engaging surplus labour has become a concern to the Government of India. (2019) 'Relationship between Population and Economic Growth'. Format: PDF and MS Word (DOC) pages = 65 ₦ 3,000 Various economists classify different nations according to levels of economic development (developed or developing), population density, age -structure and income inequalities in order to establish the apparent correlation. He described it as ‘the most delicate and difficult issue of our era… It is overlaid with emotion. Age structure data allow the rate of growth (or decline) to be associated with a population’s level of economic development. also argued in the same vein. As such, population growth plays a significant in enhancing steady development and economic growth in third world. IvyPanda. Population growth has been a favourable factor in stimulating growth in many a country in; last two centuries, when vast areas remained largely unsettled. Problem of increasing per capita and National Income: (2019, December 21). ⏰ Let's see if we can help you! This is IvyPanda's free database of academic paper samples. Since economic growth depends on rate of saving and investment … IvyPanda. Drèze, J & Sen, A 1995, India: Economic Development and Social Opportunity, Clarendon Press: New York. The investment-diversion effect states that, because of rapid population growth a country’s scarce resources get diverted away to the so-called unproductive sectors of health, education and social services from the more productive growth- oriented sectors. While some economists postulate that economic development slows down in periods of high population growth rates, others argue that high population growth boosts economic growth. Potentialities for development are adequate. 60 no 1, pp. This development, consequent upon Mathusian pressure, has been forcing many farm people to migrate to towns and urban areas in search of employment. The fact that populations and economic output tend to grow in tandem, albeit at different rates, has been well-documented. Write an essay about editorial youm e azadi essay in urdu for class 6 how to write a conclusion to an essay what's the sat essay out of. To that end, environmental degradation leads to agricultural stagnation that in turn affects the economy in a negative way (McCulloch & Baulch 2000, p. 102). The literature on population and economic growth is about as old as economic … Nonetheless, population growth does not affect the rate of economic growth in steady states (Jayati 2013, p. 76). Thus, both demographers and development economists emphasize on the population growth–economic development nexus. The US economist Kenneth Boulding made the following statement: “Anyone who believes that exponential growth can go on forever in a finite world is either a madman or an economist.”. Moreover, it will provide an outlet for the products of efficient, large scale, mass- production industries. The global population has grown from 1 billion in 1800 to 7 billion in 2012. Three Centuries of Fundamental change ’, Quarterly Journal of economic development essentially rests on three pillars income. 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