SEATTLE — During the Global Economic Outlook panel at the 2017 World Economic Forum in Switzerland, a politician from the United Kingdom named Philip Hammond commented on the relationship between population growth and GDP growth in sub-Saharan Africa. “This is nowhere near enough growth to absorb the population growth… and unless we solve the problem then the pressure from sub-Saharan Africa will continue,” he said. This statement is an implication of rising income inequality in the region and relates to a theory of population growth formulated more than 200 years ago by Thomas R. Malthus: the Population Trap.
Malthus was a conservative minister who lived in England during the early years of the Industrial Revolution. He developed an argument that when a population’s resources increase, the population itself will grow, negating any gains in individual income or expansion of productive capacity in agriculture. This was because of the necessity of food “to the existence of man” and “the passion between the sexes” as an indomitable force of nature. Ultimately, the “natural tendency” of population growth is infinite, while there is only a finite area of the earth suitable for agriculture.
According to the theory, if two workers get a wage increase and procreate, demand for food would increase. This ever-increasing demand would require a greater supply of food, resulting in more land needing to be used for agriculture until, finally, food prices would only rise, and not be kept down by an increasing supply of food when there is no more usable land. This would lead to the gains in workers’ incomes being diminished by constant inflation and, eventually, food shortages.
The Economist points out why this theory is less relevant today. The industrial revolution led to a parting from the subsistence living which was so common before, particularly for those living in the western countries of Europe and North America. Due to sustained economic growth, “economies were starting to expand faster than their populations.” Production increased thanks to modern farming technology, and the lowering of trade barriers, such as the Corn Laws in the U.K., allowing these new producers to compete against domestic producers in industrializing countries. Instead of infinite growth, population growth in industrializing countries has tapered off due to decreasing birth and death rates brought about by modern medicine.
Despite these new dynamics, the population trap is still relevant today. History shows that developing countries need an industrial revolution, not a constant focus on building capacity for resource extraction. Population growth has stabilized at around 0.3 percent in industrialized countries in 2015, and least-developed countries have an average of 2.2 percent, according to U.N. statistics. This growth in population means that once development lifts these people out of poverty, Least and Less Developed Countries will see the largest consumer base growth in the world, which has the potential to bring growth to economies everywhere. Of course, they must escape the population trap first, but by supporting organizations, policies and social movements which build community wealth, like the Fair Trade movement, we can do our part to help.
– Lucas Woodling