Demography And Economics

It’s another one of those things I’ve been asking for years and getting no good answer:  how does the economy “grow” with a declining population?  On the other hand, can the population just increase ad infinitum with no limit?  To what degree is the economic malaise attributable to simple demographic reality?

Bill Bonner of The Daily Reckoning wrestles with the problem.

 

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3 Comments

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3 responses to “Demography And Economics

  1. Charley

    The demography point is interesting, but the “real” fundamental story is all about energy. The ratio of energy output to energy invested with oil is about 100 to 1. With solar it’s about 3 to 1.

    Nothing we have in terms of alternative energy sources comes anywhere close to oil. As a species, we won’t be able to continue growing GDP and population so fast because we are running out of this awesome, potent source of energy called hydrocarbons.

    The last hundred years have been an anomaly when it comes to growth. The next hundred years will involve a lot of difficult adjustments.

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    • What’s wrong with 3 to 1? It’s a lot better than 1 to 1. We’ll just be a little more tired is all. We’ll have to go back to “many hands make light work” and have larger families. An energy deficit baby boom. Demographics, economics and energy production meet in the 21st century.

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  2. Charley

    Nothing wrong with 3 to 1. I was just trying to convey some sense of how unique oil has been as an opportunity for our species. Going forward we will have to live with a much smaller “footprint.” We are going to look back on these as times of great decadence and excess in terms of energy consumption. Perhaps you are right about larger families, but that presupposes a rural lifestyle when another major trend for our species is the huge growth of slums (also called urbanization, the urban poor, etc.) See Davis, Planet of Slums.

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