1. Population Growth and Economic Development: Causes, Consequences, and Controversies
Lecture 7 1

2. The Basic Issue: Is Population Growth Good or Bad?
Argument:
Population is a serious problem in developing countries?
Theories:
Demographic transition
Malthusian model
Microeconomic theory of fertility
Facts:
Some empirical evidences
Policies:
What can developing countries do?
There are six major issues concerning population growth and quality of life.

3. 1.1 Population Growth Is A Problem!
Population and the Global Crisis
Poverty, low levels of living, malnutrition, ill health, environmental degradation, etc.
Population-poverty cycles
Population growth, saving, per capital income growth
7 Negatives
Lower Y per head
Poor people bear burden of population growth
Large population limits educational opportunities
Health of women is harmed
Family food is limited
Environmental degradation occurs
Illegal international migration and over urbanization

4. 1.2 Population Growth Isn’t A Problem!
Other Issues
Underdevelopment
Resource Depletion and Environmental Destruction
Population Distribution
Subordination of Women
False Issue
Neocolonial dependence theory
Desirable
Consumer Demand
Economies of Scale
Labor Supply (sufficient-low cost)
Non-economic reasons

5. 2.1 The Demographic Transition
Stage I: high birthrates and death rates
Stage II: continued high birthrates, declining death rates
Stage III: falling birthrates and death rates, eventually stabilizing

8. 2.2 The Malthusian Model

9. Criticisms of Malthus’ model

10. 2.3 The Household Model
The microeconomic household theory of fertility

11. Demand for Children Equation
Where
Cd is the demand for surviving children
Y is the level of household income
Pc is the “net” price of children
Px is price of all other goods
tx is the tastes for goods relative to children

12. Demand for Children Equation
Under neoclassical conditions, we would expect:

14. 3.1 Population Growth: Numbers

22. 3.2 Population Growth: Structures

26. 3.3 Population Growth: Relations
Population growth & income
Population density & income
Population growth & structure (Number & Structure)
Producer & consumer

30. 4. Some Policy Approaches
What developing countries can do:
Long run: increase the price of child
opportunity cost of mother’s time
Cost of educating child
Short run: control fertility
Persuade people
Family-planning programs
Economic incentives and disincentives
Redistribute population
Coerce people
Raise women’s social and economic status