Economic implications of demographic change

TRANSACTIONSOF

Economic

THE ROYAL SOCIETYOFTROPICAL

implications

R. H. Cassen International Oxford, OX1 3LA, UK

MEDICINEAND

HYGIENE (1993)

of demographic

87, SUPPLEMENT

s1113

1,13-18

change

Development Centre, Queen Elizabeth

House, University of Oxford,

21 St Giles’s Street,

Abstract This paper considers the principal economic arguments surrounding the fact of rapid population growth in developing societies. It suggests that the extent of controversy which has attended this topic in the past can be greatly reduced by identifying precisely the indicators in respect of which the economic effects of population growth are judged. If indicators of individual well-being are chosen, the effects are likely to be negative in most cases. For other indicators the outcomes are less clear. The paper also examines some of the principal national and global issues affected by population growth, and suggests that it is not population alone, but the relations between population and income growth and technological and policy choices, which have to be understood if the ‘population problem’ is to be seen in true perspective. Prospective population growth can be accommodated; but institutional and political capacities will be severely tested by it, and could prove inadequate. Most countries, and the world as a whole, would certainly be better off if population were to grow more slowly. Introduction It is well known that Thomas Robert Malthus produced the first dynamic economic-demographic model, though his 18th century English would never have encompassed such a barbarous term. It is also well known that his model’s main assumptions and predictions have proved false. Agriculture, on a global basis, has grown faster than population for a very long time, far from being doomed to lag behind it as Malthus thought. And populations in most countries have slowed their rates of growth with rising living standards, rather than been restrained by ‘positive checks’ when population presses against the means of subsistence. It is less well known that by the end of his life Malthus was no longer a Malthusian; in the last (1826) edition of the Essay on Population (the first was in 1798), he advocated universal education as a counter to the ‘population principle’; it would help to postpone marriage and limit population growth, giving to the ordinary man ‘a portion of that knowledge and foresight which so much facilitates this object in the more educated part of the community’. This is a glimpse of the historical background to the modern understanding of the demographic transition. Relations between population growth and economic development are two-way’. Increases in population affect both the volume and composition of output; and, as economic development takes place, a wide variety of changes occurs which in turn influence both mortality and fertility. There is a period during which population growth is relatively rapid, while mortality declines before fertility responds both to that decline and to other forms of social change--especially the spread of education; and then fertility begins its decline. Neither Malthus’s original views, nor modern models of ‘immiserising growth’, or ‘low-level equilibrium traps’, have any significant currency among economists today.2 In what follows, I seek significant generalizations, largely abstracting from major differences across and within countries. In almost everything to do with development, exceptions can usually be found to any proposi’ This is essentially why there is no (negative) correlation between population growth and economic growth. Some authors, e.g. SIMON (1989), use this fact to counter the common view, that population growth has harmful effects on the economy; but there is a simultaneity bias in the correlations--see BLANCHET (1991). 2 This would include ‘demographic traps’ of the kind suggested by KING (1990). One fundamental flaw in that argument lies in the fact that the sooner mortality declines, the sooner fertility is likely to follow, and the lower will be the ultimate population size. Infant and child mortality declines appear to be a necessary, though not a sufficient, condition for fertility decline in poor, high fertility countries. It is unlikely to be a good strategy (not to speak of ethical issues) to postpone mortalitv decline deliberatelv. (This is not to say that there cannot 6e low-level dynamic equilibria; there can be, and at least locally, there have been. But they are not inescapable.)

tion. In a half-hour lecture on an enormous topic, one cannot hope to do more than capture some general tendencies, and contribute to the analysis of issues; the subject is, in any case, a long way from being prone to definite conclusions. The macroeconomic case Academic discussion of the theory of the effects of population growth on the developing economy has been full of controversy. Much of it has arisen from a lack of clarity about indicators. One can look at 4 separate questions, in each case implicitly contrasting 2 paths for an economy over time, one with a higher and one with a lower rate of growth of population. (i) Does rapid population growth reduce the rate ofgrowth of a poor country’s gross national product (GNP)? The answer to this question is ‘probably not’. Population is a resource, and unless no use whatsoever can be made of additional numbers, or actual growth-reducing effects occur, it will add to growth.3 (ii) Does rapid population growth reduce the rate of growth of a poor country’s GNP per head? The answer to this question is ‘very probably yes.’ Population growth may not influence the rate of capital formation positively or negatively-the literature is inconclusive. But if capital formation is unaffected by population growth, &ere will still be less capital per head. and therefore less income oer head. (The moductivit; of capital should rise with Lore labo& pe; unit of capital, and lower wages.) Essentially, economists ask whether there is anything in population growth itself which raises labour productivity; the answer seems to be that of course productivity can rise over time, but this is mostly independent of population growth; if anything (see question iv) rapid population growth makes it harder to raise productivity. There is one argument which points the other way: larger populations may permit economies of scale-the same combinations of capital and labour produce higher output.4 But this argument too has only limited force. 3 One argument has been the alleged ‘savings effect’-that savings, and therefore investment, would be reduced under high population growth. But this argument is uncertain today. For an early statement of the case, see COALE & HOOVER (1958). For some treatments of the entire debate, see BIRDSALL (1989), CASSEN (1976), MCNICOLL (1984), or KELLEY (1988, and an unpublished paper entitled ‘Revisionism revisited’, presented to World Bank Seminar in Washington, DC, in January 1992. The case is also made that environmental damage is not accounted for in GNP and, if it were, the impact of popuiation on GNP growth would be negative: but the relations between population growth and the environment will be addressed elsewhere in this paper. 4 See footnote on next page

s1114 Economies of scale are available in export marketscountries do not necessarily need extensive markets of their own. Markets are not matters of sheer numbers, but of numbers with incomes to spend, so the argument makes assumptions about the issue it claims to address. Further, the argument has not normally encompassed natural resources and the environment as factors of production. It is at the least begging the question to assume that environmental effects do not create diminishing returns to scale. Clearly population cannot grow indefinitely without running into diminishing returns---but there are two questions: if there is a phase of higher returns to scale, what happens during the transition towards it? It could well be that the transition brings effects which worsen the economy’s capacity to take advantage of scale economies. And at what point will diminishing returns be encountered? There is little if any empirical analysis of these issues. (iii) Does population growth increase welfare?

This is of coursewhat interests,or shouldinterest, us. Economists,contrary to someviews, are not concerned with incomes,but with happiness.Income per head is obtained by dividing total income by the number of heads;but this assumes that the numberof headsis not itself a potential sourceof satisfaction.Incomeper head is commonlyusedasan index of welfare, but in this context it begsthe question. In fact, few discussions of our topic ever addressthis point, for a simplereason:economicshasnothing conclusive to say about it. Supposewe could actually measureindividual welfare, in inter-personally comparable‘utils’. Is a societyof a million individuals enjoying 500 utils eachbetter or worsethan one of a million and a half enjoying 450 utils each?Economicscannot answersuch a questionand, in all probability, nor can anything else. The universaltendency is to considerlevels of individual welfare, as measuredby someindex. But it is worth enteringthe caveatthat onedoessoby ignoring the issueof whether the existenceof morehuman lives should enter positively or negatively into the calculus. While it is difficult to talk of thesethingsat a societal level, it is more comprehensible at the familial level. One can well imagineparentssayingasa matter of deliberate choice ‘it may make us poor, but we want a large familv’.5 It is nerfectlv natural. andnot deniedevenbv economists, that parents may -value children for their own sake,regardless-up to a point at least-of the effectson their standardof living. In this context one can refer to the ‘revisionistview’6 which grew up in the 1980s;in one version, it departs from the macroeconomiccase,and asks:parentsmake their decisions,and have a right to do s+why is this a societalissueat all? The answeris, of course,that there may be conflicts betweenindividual choicesand the social good: in fact the revisionist view arguesthat these conflicts have beenexaggerated.I shallhere bypassthis argument; there are major conflicts, in my view-but they shouldbe accuratelyreflectedin the macroeconomic case.The effects, or ‘externalities’asthey are known to economists,that individual parentaldecisionsimposeon 4 This argument is due to BOSERUP (1965), much qualified later (BOSERUP, 1981). Most of her work relates to the question of whether increasing rural population density induces favourable technical change. It may well have done over the long sweep of history; but today relevant technology is commonly available, even if not adopted. See further below. 5 This is not of course the tenor of the developing country microeconomics of family formation, most of which assumes that parents take economic considerations into account in fertility decisions, and some of which-correctly or not-concludes that they may be better off with large numbers of children. (It could also be that parents are better off but the children are not: there are many difficult issues of welfare within the family.) 6 The phrase is due, I believe, to BIRDSALL (1989).

other familiesand societyand economyasa wholeshould broadly be captured in the assessment of the impact of populationgrowth on the economy. (iv) Does rapid population growth impede the attainment of other developmental goals?

The answerto this questionis‘yes’, in virtually every case.Whether the goalsare those of human development-health, education, personalfulfilment of every kind-or sustainableeconomicgrowth with rising employment and levelsof living, any low incomeeconomy hasto struggleto provide for growing numbersand can provide more easily and at higher standardsfor less rapidly growing numbers.The rest of this paperlooksat theseissues. Human development Education

All low income countries are far from being able to offer adeauateeducationaland health facilities for their existing populations. In most countries primary school enrolmentsat leasthave grown fasterthan populationfor severaldecades,with somefaltering in sub-SaharanAfrica in recent vears. This reflects the hiah nrioritv most governmentshave placedon education‘;s long aseconomicconditionspermit. But the quality of this education is often Door-insufficient nhvsicalfacilities. text-books and educationalmaterials,few’levelsof teachertraining; andthere arehigh drop-out rates.Increasingenrolments and reducing drop-out ratesrequire increasingboth the quantity andthe quality of provision. It is obviousthat the larger the numbersfor whom this hasto be done, the harder-it is to attain. A projection for Pakistan showsthat, starting in 1990, a 20 year difference in the date of reaching replacement fertility makesa differenceof over one-third (7 million children) in the populationof primary schoolageby the year 2010; and over 27% (5.5 million children) in that of secondary schoolage(WORLD BANK, 1989).Suchfigureswould be typical of a country with a high rate of population growth. Given Pakistan’salready low ratesof enrolment and low levelsof public expenditure availablefor education, this fact by itself impliesseveredifficulties for the country in achievingeconomicprogress. Production and competition world-wide are becoming increasinglybasedon skill and knowledge. Low-income countries, and especiallythosewith modesteducational attainmentsand rapid populationgrowth, will find it difficult either to completetheir developmentor to keepup with the speedof changein the international economy. There is a distinct possibility of a widening of the economicgulf betweenthe better-off and the poorercountries for this reasonalone. Health

All developing countries except the most advanced have huge backlogsof health provision. As with education. raoid nonulationgrowth hindersthe achievementof universal &&ision and improvements in quality of health services,associetieslabour to makemodeststandardsavailableto growing numbers.In addition, high fertility is itself a causeof high mortality-both child and maternalmortality. Pregnancy-relateddeathsand, especially where contraceptionis not available, lethal abortions, are the leadingsourcesof femalemortality in the 15-50 years age-groupin very many developing countries. (Risk of death due to pregnancy is 50-200 times more in developingthan in industrial countries.) There are numerousother adverse effects on mothers’ and children’shealthof largefamiliesand closechild spacing. It is not only a matter of health services.,of course,but of other health investments,particularly m water supply and sanitation.What needsto be done, or more usually the backlogof what is undone, growsat a pacethat rendersremedialmeasures difficult where population numbersare doubling in a generation;in the poorestcoun-

s1/15 tries, remedy may be simply are duplicating facilities for pense of investments which the economy more productive, the health s.ecfor.

out of reach. At best they growing numbers, at the excould be making the rest of or raising quality within

One of the most obvious ways in which family decisions affect those outside the family is through the labour market. Each household makes an imperceptible difference; but the combination of all households hoping for income gains from large family size results in a rapidly expanding labour market which will tend to depress pay. Couoled with the effects on education and health orovision; and the calls a growing po ulation mak& on Parger spreading the capital stock among numbers, instead of raising the amount of capital per worker in the productive sectors, the result is a poorly educated and insufficiently healthy labour forcbitself a condition for low productivity-whose numbers drive down pay in an economy which can transform itself only slowly. This is not a ‘low-level equilibrium trap’; even under such conditions, living standards can rise. Eut the alternatives are the same when looked at from this point of view: conditions improving only slowly for rapidly rising numbers, or improving faster for a more slowly growing population. It is not only a question of productivity and mcome growth; people deprwed of education and good health cannot avail themselves of much that society has to offer in terms of the quality of life. Once again one might note that high fertility makes its own contribution to this: a woman experiencing the current average fertility levels of sub-Saharan Africa will spend approximately one-third of her adult life in pregnancy or breast-feeding (DASGUFTA, in press). Under high fertility, the burdens of child-rearing on women are particularly heavy. One of the most absurd of the propopulation arguments in the literature is that the more people a society has, the more ‘geniuses’ there will be, and these are the people who create technical and cultural innovation (SIMON, 1981). It is the unfulfilled potential of society undergoing rapid population growth that should concern us, rather than the possibility of such growth generating additional exceptional individuals; how many such individuals may there not already be, whose porcntial gifts are never discovered. Sustainable economic development The issues discussed above seem relatively uncontroversial to me. Much more difficult are the uestions of the implications of rapid population growth 7 or the sustainabiliry of economic development, and indeed of life on the planet’. The most difficult issue is to isolate the effects of population growth from those of economic growth. In what follows, I shall make the simplifying assumption that population growth has no effect on economic growth; economic growth takes place, but its composition and distribution are affected by population growth, and so are living standards. We can then ask, what effects are attributable to economic growth, and what to population. Perhaps the 3 most significant effects come through the demand for food; through increasing rural or urban population density; and through poverty. While income growth affects environmental impact, the differences with and without population growth are particularly significant in these areas. The environmental impacts will be felt particularly on renewable resources: soils, air, water,and plant and animal populations.

FOUd Without

population

7 By ‘sustainable’ withour detriment future generations’.

growth,

1 mean ‘reproducing to the productive

rising

incomes

levels of capaciry

consum availab

would rion Ye 10

generate relatively little increase in demand for cereals, and none at all amongst better off people, whose demand is more or less saturated; but there would be shifts in demand amongst poorer people whose incomes were ridng from rice to wheat and to coarse grains for animal feed. According to one estimate, total world demand for food grains rises from 2 billion (2x 109) tonnes in 1990 to 3-6 billion in 2030: only O-14 billion is the result of rising incomes, per caput cereal consumption increasing from 377 to 404 kg: 1.46 billion, or over 90% of the increase in demand, iz the result of- a projected 68% increase in population over the40yearsa. One major concern is the potential environmental impact of meeting this demand. Naturally much will depend on where the additional crops will be grown. But it has to be expected that a great deal of it will have to be grown where the additional demand originates, i.e. in the developing world. Here there is little scope for bringing additional land under cultivation at acceptable economic and environmental cost. (Some 60% of current deforestation in Africa and Latin America may be due to agricultural expansion; WORLD BANK, 1992.) Most of the increase will thus have to come from improved yields; in any case, while there are environmental problems in intensifying agricultural production, they are probably less troublesome than extending low-input agriculture. They are, however, quite troublesome enough. Assuming no major climate change [and of couzsc global warming is an uncertain factor), the environmental effects depend mainly on land, water and technology. One study has examined fairly carefully the prospects for achieving output increases on the scale projected. It concludes that, OII the basis of existing knowledge, environmental damage on a considerable scale is the likely result. The ce of current land degradation, and the relative roles o p" human and natural causes, arc among many significant unknowns (ANDERSON & CROSSON,, 1991; MYERS, 1988). If agriculrure were to expand by mcreasing the area of forest, range and pasture land brought under cultivation, erosion and sedimentation would increase; hence the conclusion that intensification is essential. It is well known that considerable damage is currenrly being done to soils already under cultivation, but it is believed that improved soil conservation practices could limit it (‘could’ is the critical word; one would not predict that such Dractices will necessarilv be widelv followed>. The critical and most intractable*limiting constraint on increasing output under existing technology is water. The problems arise for a number of reasons. One is the growing economic and environmental costs of extending irrigations; another is the increasing competition of water demand arising from sources other than agricultureurban and industrial growth; and a third is the ‘extcrnality’ problem: each farmer's use of water for irrigation imposes on downstream users of the same water, through the transmission of salts, agricultural chemicals and sedimentation. It is very difficult to induce farmers, either by incentives or by regulation, to change practices that have no cost to themselves in any way which would limit the cozt to others. Although use of agricultural chemicals in the developing countries is at present mostly at low levels, needs for agricultural intensification are likely to expand their use greatly. For all These reasons, econotic and environmental costs associated with water for agricultural expansion are likely to rise very considerably. The upshot of this analysis is that yield-improvinp technology, and particularly water-saving or dro;ght-rey

costs

calculations, based on WORLD BANK (1992) and 6MY ANDERSON & CKOSSON (1991). 9 The potential for improving rhe management of existing irrigation is considerable, and a large proportion of past irritation works alreadv reauires refurbishmenr: but such measures are nor judged-to be- likely to make a large lm~acc an increasing irrigation porenrial relative to rhe magnitude of the needs for increased cropo~tput.

sisting and noxious-chemical-avoiding technology, is going to be essential for raising crop production on a sustainable basislo. Such technology has appeared in the past; but that is no guarantee that it will in the futureI]. Many observers believe thar the volume of resources currently being devoted to agricultural research does not come close to meeting the likely needs. The discussion here has concentrated on cereals, which are of course critical for growing populations in low-income countries. There are naturally problems associated with fish and other food sources. many of which already face threats from growing demand and insufficient regulation. But on rhe whole these threars have arisen mostly through income growth and improvements in catching, preservation and transport technologies. It is true that once incomes reach the point where mosf people can afford fish and animal foods, the more people there are the grearer will be the strains on resources, and the more costs will increase. Increasing population also induces more people to seek Iivelihoods from coastal and fresh-water fishing. But these issues cannot be treated within the scope of the present paper. This discussion is of course highly relevant to the wider issue of the macroeconomics of population change. Were populations growing more slowly, economies could devote fewer resources to decreasing-return agriculrure and foodproduction,andmoretootherformsof production which may prove easier to expand on a sustainable basis. 12 Critical questions in the population debate surround the effects of increasing population density. In addition to the food issues discussed above, rural population growth puts pressure on land, plant and forest resources, and wild anti habitats; increasing urban densities or the spread of urban areas also create a host of problems. Once again, one must try to separate the population effects from those of income growth and technological change-though this is exceptionally difficult in the rural scene. There is a familiar syndrome in many parts of the rural ‘Third World’ of deforestation, soil degradation, declining agricultural productivity, and deteriorating ecology. It has to be said, however, that these phenomena are far from universal. Africa alone exhibits a varietv of exoerience: there are areas where agricultural producnvlty, forest cover and soil conservation have all improved with increasing population density (see, e.g., TIFFEN, 1992). There are also examples of where these things have nor happened; indeed, many parts of Africa could be cited as counter-examples IO the ‘Boserup hypothesis’ of population-induced improved intensity of cultivation (see footnote 4 on p. 14). One author contrasts the Boserup view of Lauf~n~m~u~ inrensitication’ with thar of policy-led intensificationl3. The favourable factors include positive government policies, market development, education, access to information, technology and capital, and changes in family and community which permit enhancedrolesforwomen.'~ Unfavourable developments have stemmed most often from shortening fallow periods (which are imposed by increasing population density), without adequate attention to conservation and nutrient-maintaining measures. But “The water problem varies in importance from region to region; but it may prove in many places to be the most immediately limiting constraint on agricultural growrh. By 'technology' here is meant improvements in plant varieties as well as cultivation pracrices. 11 at nitrogen as a constrainr, and the likelihaad of technologicalimprovementa,see Sti1L(*991). ” CASSEN (197X) sug ested that rxsing agricultural costs were f ndlam.alreadyapparenrin the 1970s ” LELE &- -STONE (1489). The paper cites and discusses examples of improving and dcrerioraring situations. See also chaDrer 2 (Ho. T. 1. Population nrowch and aericultural

much of the environmental destruction has been due to factors other than population. Road construction through forest areas, for example, often measures in advance only the forest area to be cleared for the road itself, and does not allow for roadside setrlement which follows the new economic opportunities presented by the road; the latter often results in large tracts of deforestation. Governmenr policies, technological change, even land reforms unsupported by appropriate productivity measures have all been blamed for environmental damage (see DASGUPTA & M&~R, 1990). Wood fuel requirements for cooking, on the other hand, are strongly populationrelated--though here again the extent of damage depends on whether favourable change does or does not follow population growrh. Many of the relevant features of the rural economy in developing countries are described under the rubric of ‘the management of common properry resources’. Very often traditional communities do have adequate systems of management of such resources; but these quite commonly break down under ~opularion pressure. Here a crucial factor is whether at er commututy management can be strengthened, or property righrs become vested in individuals so that they have incentives for appropriate management. The fuel-wood situation is affected by these and other features. Many communities show considerable ability to substitute other fuels for wood, or adapt by other means, when wood is scarce (see, e.g., DEWEES, 1989). If markets in wood develop, and growm g it becomes profitable, farmers will devote a share of their land to trees15. Once again, experience is variable, and population is far from being the sole cause of problemsin ~ommonpropertyresourcemanagement.l6 The urban problem is more clearly population related, though of course the nature of development, incentives and policies also play a part. The very rapid growth rates of urban populations in developing countries have partly to do with natural increase rates, and partly with ruralurban migration”, which is obviously affected by the character of rural development and the relative arrractiveness (from pay and other points of view) of urban life. It is possible to produce nightmare scenarios of the urban future based on simple extrapolations of the pasr, showing huge urban agglomerations developing with insuperable problems. In fact cities in a given country will tend to follow S-shaped growth curves; as the larger ones u per part of the S, other cities take over reach the flatter 5: And as growth uoles.’ as rural develotxnenr Droduces staGdards df living closer to those of the cities, Migration rates decline. Economic development in fact tends to improve most aspects of urban lifedventually. Urban sanitation, housing and air quality are all things that improve as incomet rise, (WORLD BANK, 1992 [chapter 11; BBCKER“T’&

candiit%n;c$nder which population grawrh induces or fO favourable accorn~n;~lmg c+nges are obviously exrremc1v comdex. attrlbuuon of envlronmenral damage to population growth will depend on whether such change is incorporated m one’s ‘model’ as a variable or as a constraint, and appropriate specification of tie initial condzrions, favourable or unfavourable. Clearly tie arrrlbution of d-age m population growth in a view such as That ofKlNC <1990) is overly simplistic. " See chaprer 3 (Barnes, D. F., Popularion growth, wood fuels, and resource oroblems) in ACSADI ef or. 11990‘1. I6 Other fact&s inclube goyernme~n! . po&ies;migration from drought, confl~cc or cwxlunresr; r+ngmarker ;z;kzn f or natural resource products and ensu,ng ourwd~ entrepreneurialororherinterests. “One should not exazzgerare the role of mimarion. Not surprisingly, escimare;shaw rhar cities grow -fastest when national popularions are growing fasresr. " CASSEN (1987) observed that the central wards of Calcutta Losr population between the 1961 and 1971 censuses. Rural-urban migration is usually analysed in terms of ‘push' and ‘pull' saciologisr, factors; as Ashish Bose, the distinguished Indian put ir, with Indian aties one has to reckon w,th rhe ‘push-back’ facror.

SUl7 MAN, 1991), though the latter (and of course transportation problems) go through periods of worsening until remedies are achieved. ‘Eventually’ is, however, rhe key word, and the abysmal conditions of life in most ‘Third World’ cities in their phase of rapid expansion need no emphasizing here. Nightmare scenarios are sometimes aozompanied by huge and unaffordableestimates of investments requiFed for improving urban environments. In fact when low-cost rechnologies and cost-recovery techniques are taken into account, many desirable measures seem much more within reach. And when benefits are taken into account, they can manv of the often be shown to be even more desirable: urban pollution effects of rapid population growth a& major and also reduce labour productivity. health hazards, WORLD BANK (1992) cites the extreme case of Peru, where the losses of agricultural exports and tourism earnings in tie iirst ten weeks of the 1991 cholera epidemic were 3 times the entire amount invested by the cou&ry in wa!er and sanitarion during the whole of the 1980s; less extreme cases indicate hiih pay-offs to public invesunent on these items. It also cites studies from Africa? Asia and Latin America showing tbac individuals at all uxome levels are williig 10 pay much more than is conunonly thought for household water and sanitation. It seems rhat there is a cycle through which all countries go, during which cities move through periods of intense environmental stress, after which most-if not all-things gradually improve. It is clear that the majority of the problems are population related; automotive pollution is the most obvious feature which is mainly income related. This apart, economic growth tends 20 improve the urban environment-again, one must add, eventually. And appropriate policies and technologies can do much to mitigate the damage of urban growth. As noted above, a rapidly growing labour force will make for intense labour market competition; this is not the condition for a high wage economy with rapidly increasing living standards. At the household level, large numbers create difficulties in achieving better health and education; productivity is consequently likely to be low. At the same time, with few resources of other kinds, parents are likely 10 see children as potential sources of family income. High fertility is rightlv seen to be both a consequence and a cause of poverty Many of the adverse ecological trends observed in developing countries are in considerable measure artributable also to poverty. In rural areas, it is the poor who depend on many of the comon property resources for consumption and livelihoods, and their growing numbers subject these resources to sfress. Time horizons are typically short for poor peoplelg, and mining of resources rarher than attention to conservation is conunon. In urban areas also,. the conditions in which the ooor live conrribute a la&e share fo urban health and other hazards; the poor are also rhe main sufferers from pollution and lack of clean water and sanitation. Families may be doing what they see fo be the best for themselves; but the outcome of large numbers of families doing the same is something of a self-perpetuating syndrome, passing from one generation to the nexr. It is surely absurd for the ‘revisionists’ to suggest that high fertdity in these circumstances is anything oiher than harmful. But provided no threshold of irreversibility is passed, societies will emerge from these conditions. Ecanotic developmenr provides the resources for coping with environmental problems at large. It also brings to the individual both resources and motivation to alter fertility behaviour. A critical transition occurs as parents change, from looking at children as earning assets for the

family in the near term, to putting a high value on their children’s future in the long term-something they cannot fulfill for large numbers of children. One furrher iabour market aspect deserves a brier mention. Eecause of international trade and investment, the low wage economies of developing countries do exert some downward pressure on living standards, particularly those of the lower paid individuals, in the tndusrrial countries. The industrial worker in our societies has an interest in lower population growth and rising wages in developing counties (KING: 1991). If living standards in these countries do not improve, and population growth condnues at high rates, one of the consequences may be increasing social and political furmail. Particularly in already populous countries where ethnic and other tensions are severe, rapidly increasing city size and population densiry without social progress can impose swains on gover-ent and people which make it difficult to carry our the wise policies on which improvements depend. The economist does not normally include governmental and institutional capacity in the analysis of economic development under rapid popularion growth; but these may prove to be critical constraints in some countries. It has fo be accepted that world population is going to grow considerably--to some 10 bilhon by 2030 under the id ferWorld Bank’s ‘base case’ scenario. Even with ‘ra tility decline’ it will reach some 8 billion. The dl -P ference made by the time stable population is reached in the mid 22nd century is some 2-5 billion (12.5 as opposed to 10 billion) (WORL.D BANK,, 19923. The rapid fertility decline fax is quite implausible; It appears that the difference which can be made to population rowth in the neare* term is relatively modes@. Every e B art should, nevertheless, be made to contain that growth, since the difference which resulrs in the longer term is very l~~tbe ‘slow fertility decline’ case does not much differ from the base case by 2030, but by 2160 the difference is more than 10 billion over the base caee(22-5biUionasopposedto 12-5 billion). Econoxnic development will improve some aspects of life and environment, and-at least at first-worsen others. The WORL.D BANK (1992) suggests that it can all be accomplished without environmental disaster, given appropriate policies and research efforts; for a different but also balanced view see HARRISON (1992). This may well be correct; but it is hard to be confident that all the good things which have to happen will in fact happen. Good policies require stable governments, information, analytical capability, and people to carry them our, many of which are lacking in many countries. The social and political difficulties which may be caused by further population growth may themselves complicate the task. Rapid population growth poses many threats fo individual and global well-being. l3ut as far as the global environmenr is concerned, it is by no means impossible chat the behaviour of the industrial caunrries, where population will barely grow at all, will do the larger share of drastic and irreversible damage. Controlling the environmenral effects of their economic growth is porentialjy hugely expensive, and by the time enough is known to convince policy-makers that action must be taken, it could be too late. Global warming, ozone depletion, acid rain-these are among the effects which do not improve with economic growth, or at least have not done yet. It must be hoped that developing countries will not make the same errors; they will at least be able fo learn from those aho are further down the path. 2oTherc

is

of

course

the

major

unknown

factor

of

AIDS.

BONGAARTS (1989) suggesrs chat it could increase the death rare in sub-Sahara" Africa by 10 poinrs per 1000 abovewhat it would otherwise have been by the year 2010; in axher ward--lf there were no cansequence for fertility-it would reduce papularion growth by 1%; bur see GARNET-~ 81 ANoEnsoN(1993).

Sl/l8 Ackmwledgements I am indebted Mendelssohn for

to helpful

Will

Cavendish, com.nen~s.

Peter

Dew-3

and

Development Dewees, P.

Gaie

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