Why does low population growth foster econ growth? growth, people, around

homie

Seems like it would be the other way around since more people = more output even if the pie is split more ways.

bpdulog

No, I think that one is the dismal science theory, which looks at population growth as a detriment, but here this is looking at low population.

cfa10yrplan

This is in line with the classical population growth theory, no?

meghanjackson

per capita GDP goes up, that simple.
Let’s say your real GDP is growing at 3% annually, and your population growth is also 3%. After 5 years, the per capita GDP will be teh same as it is today. But if your population growth shrinks to 2%, you will have a much higher per capita GDP. They are not talking about overall economic growth, rather a relative measure of it.

fishmarket

yeah, but neoclassical also says that with improved healthcare, people live longer, so it kind of cancels that out.

kkn006

I believe this is referring to the Neoclassical Growth Theory that states that one of the main drivers of per capita GDP growth is the opportunity cost of women’s time. If the opportunity cost is high more women will work in lieu of raising children, therefore, contributing to GDP through working and contributing on a per capita basis by not having children.

strikethree

screw qbank.

jarobi04

It was from a QBank question and did not reference any of the theories. It just made that statement as a matter of fact

BelalM

who says low population growth fosters ecnomic growth. there are many theories and these theories dont’ quantify how much of population growth is ideal.
but if you ever read production function (cobb douglas), then you’ll know that, that the answer really depends. as long as your capital per labor output is growing you are going to have growth. now if u have more ppl, more research and more tech, its possible you can employ the new population to grow ur capital per person at a much faster rate than population growth. Ex. USA / China
but if u have less people but everythign else remain constant then ppl enjoy more. EX. Luxemborg.

Wendy01

Are you referring to the Classical Growth Theory?
Tech Up = Labor productivity Up = population growth Up = real GDP/per labor hr Down
Wages Down = Population Down= Cycle continues
So I dont think population growth drives the economic growth. Am I missing something?