Population: Fear of Falling
Brink Linsey has a very good series of reflections on declining global and particularly high-income country fertility and population decline. Depopulation and Decadence - by Brink Lindsey (substack.com)
John Quiggins has an interesting post
(which piggybacks on https://crookedtimber.org/2024/01/08/what-if-there-were-far-fewer-people/)
about how odd the sudden concern with population decline is when we have been worried for decades about OVER population. Perhaps this is not so odd as most of that was based on “We are running out of X” when X is a normal commodity whose supply and demand is mediated by market prices and just about impossible to “run out” of. Quiggins does, however, push back against some of the supposed reasons to be concerned about population decline, especially the worry about fewer Einsteins or Bachs. (Mozart is the typical example, but I think Bach is a better one.)
Concern with falling fertility and populations that grow out of seeing it a symptom of something else, possibly something quite bad in its own terms, seem worth consideration. But concern can also stem from expectation of bad consequeses. Whichever and in what proportions the motives for concern, we should also recognize that part of the concern may be irrationally exaggerated.
1. Status quo bias/fear of the unknown. For several centuries humanity has been dealing on the world quite successfully with population increase. We have simply never faced population decreases.
2. All previous periods of population decline have been the result of terrible circumstances like war or disease or famine. The association is there, even if population decline was the result not the cause of the circumstances.
3. All past periods of lower population have also had lower per capita incomes. One might think there are some economies of scale (arising from information being a non-rival good?) that intrinsically makes lower populations less productive and creative per capita. But could we be near such a point?
Given that some concern is justified, we should both try to understand the reasons for lower fertility as well as how to offset, mitigate, or prevent certain of the possible negative consequences. [N.B. I discuss relative near term effects, not populations of orders of magnitude greater or smaller than at present.]
On the consequences:
1. Dependency ratios defined as ratios of age cohorts do rise arithmetically but the meaning of "dependency” does not. People could on average spend a higher portion of their lives in the labor force.
2. The way that age-related transfers -- Medicare/Social Security/Medicaid in the US -- are financed could be shifted to a VAT instead of taxes on wages. a) The shift would make revenues less sensitive to demographic changes like longer life and labor force participation rates. b) As a tax on consumption rather than incomes, a VAT might marginally improve incentives for saving. c) Politically periodically adjusting VAT rates to keep revenues and outlays for age-related transfers in balance could be easier.
3. As people live longer healthier lives, benefit formulae for SS coud be changed. Not only could “retirement” ages be increased but rethought as people’s labor force participation became less age dependent.
4. The costs of care of the aged could fall. Thus far medical and pharmaceutical science has focused on extending life and health with little regard for cost, but that is a matter of incentives. In principle technology coud reduce the cost of care.
5. Work/careers/education coud be rearraigned to help people remain productive and creative over longer working lives.
6. While either labor shortages or technological unemployment (from, say, AI) coud be a problem, they can’t both be problems. To the extent AI seems to be of greater benefit to lesser performing than higher performing workers, it might be of particular benefit to older workers offsetting any age-related decline in productivity.
7. It certainly is the case that population growth has reduced (and population decline could increase) the space for other living creatures, but technological change and improved incentives (for example, applying a tax on net CO2 emissions to deforestation) could reduce the bite of this tradeoff. Humanity can reduce its footprint without population decline.
As for the causes of falling fertility
The most plausible reasons involve changes in the opportunity costs of childrearing, especially the costs borne by women. These cost, however, need not be disproportional to the actual time spent away from market employment. That’s sociology and economics, not biology.
There is also an argument for treating childrearing as a life event like sickness, unemployment, or aging that we should socially insure, transferring resources to those rearing children from those who are not. We already do this for much of the cost of schooling.
There, too, are distortions in housing markets that impede easy transitions in meeting space needs than change as household sizes change. This is at the individual level, but land use restrictions and building codes also make it more difficult to expand and contract supply of the quantity and kind of housing needed by different cohorts for housing most appropriate for the number of children in the household.
None of these may be easy to fix, but it would be worth doing so even if they were not a disincentive to family formation, fertility, and childrearing.
[Standard bleg: Although my style is know-it-all-ism, I do sometime entertain the thought that, here and there, I might be mistaken on some minor detail. 😊 I would welcome comments from readers.]
This is interesting. I can see this being a big problem in South Korea bc they make a lot of useful things and we want that to continue. All things being equal, I think replacement fertility is good bc stability is good. But outside of social security which is just a political, not structural problem - raise taxes or print money when few are paying for many - I don’t understand why here and at SB there’s such a push for Natalism. I get why people want govt childcare subsidy and child tax credits because by and large the commentariat has kids and would benefit - and even without kids I agree bc I want cradle to grave luxury UBI for all. But I would much rather, for the sake of the environment and just stability in general, see population decline rather than growth, especially in areas with low state capacity and where David Attenborough films nature, but also in the US. It would be nice to not have to be YIMBY bc population was stable…I dont get the growth is good mindset bc it causes all sorts of problems like decline does. Like bring more immigrants obviously to places that are in decline.
Your post doesn't touch upon the cultural and social issues underlying massively declining birthrates. South Koreans aren't even having 1 baby per person. Western European is also graying and dying. These are cultures in which the people, as an ethnicity and culture, have lost the will to live. To me, it is the equivalent of someone slowly starving themselves to death. Not because they want to die but because they cannot be bothered to eat enough food. It's the apathy that is most concerning.
I'm not so sure that the graying population won't lead to instability, war and famine. I recall reading somewhere about Ukraine's precipitous population fall post-WWII. It wasn't Russian's doing this to them. Now look at Ukraine. Weakened with a smaller population, war killing its men and the women and children driven elsewhere, likely never to return. They will marry and settle down into their host countries and being Ukrainian will cease to have any meaning, other than eating beets once a week. What will happen when youthful Africa looks to old, gray and dying Europe for example? Or Turks and Azeris, already numerous, look at a old and dying Armenia, unable to replicate itself. I think the dropping TFR will lead to a new epoch, with conquest and war and death.