Establish the Causal Relationship with Emphasis on the Direction Between Population and Economic Growth (1981-2009)
ECO 816
ASSIGNMENT
Establish the Causal Relationship with Emphasis on the direction between Population and Economic growth
(1981-2009)
PREPARED BY
ABURIME DORCAS .O.
PG/SSC1119505
SUBMITTED TO
DR. MONYE-EMINA
INTRODUCTION
The debate between positive and negative sides of population growth is ongoing. Population growth enlarges labour force and, therefore, increases economic growth. A large population also provides a large domestic market for the economy. Moreover, population growth encourages competition, which induces technological advancements and innovations. Nevertheless, a large population growth is not only associated with food problem but also imposes constraints on the development of savings, foreign exchange and human resources. Generally, there is no consensus whether population growth is beneficial or detrimental to economic growth in developing economies. Moreover, empirical evidence on the matter for developing economies is relatively limited (Savas, 2008).
According to Population ‘revisionist’ economists, population growth acts as an indispensable constituent for stimulating economic development because a sizeable population provides the required consumer demand to generate favorable economies of scale in production, lower production costs, and provide a sufficient and low-cost labor supply to achieve higher output levels (Todaro 1995,
p. 303). Johnson (1999) pointed out that a high rate of economic growth is associated with high population growth and low economic growth is associated with low population growth.
The issue of population and economic growth is as old as the discipline ofeconomics itself. The debate on the relationship between population andeconomic growth could be traced back to 1798 when Thomas Malthus published the book An Essay on the Principle of Population. Malthus claimed that there is a tendency for the population growth rate to surpass the production growth rate because population
ASSIGNMENT
Establish the Causal Relationship with Emphasis on the direction between Population and Economic growth
(1981-2009)
PREPARED BY
ABURIME DORCAS .O.
PG/SSC1119505
SUBMITTED TO
DR. MONYE-EMINA
INTRODUCTION
The debate between positive and negative sides of population growth is ongoing. Population growth enlarges labour force and, therefore, increases economic growth. A large population also provides a large domestic market for the economy. Moreover, population growth encourages competition, which induces technological advancements and innovations. Nevertheless, a large population growth is not only associated with food problem but also imposes constraints on the development of savings, foreign exchange and human resources. Generally, there is no consensus whether population growth is beneficial or detrimental to economic growth in developing economies. Moreover, empirical evidence on the matter for developing economies is relatively limited (Savas, 2008).
According to Population ‘revisionist’ economists, population growth acts as an indispensable constituent for stimulating economic development because a sizeable population provides the required consumer demand to generate favorable economies of scale in production, lower production costs, and provide a sufficient and low-cost labor supply to achieve higher output levels (Todaro 1995,
p. 303). Johnson (1999) pointed out that a high rate of economic growth is associated with high population growth and low economic growth is associated with low population growth.
The issue of population and economic growth is as old as the discipline ofeconomics itself. The debate on the relationship between population andeconomic growth could be traced back to 1798 when Thomas Malthus published the book An Essay on the Principle of Population. Malthus claimed that there is a tendency for the population growth rate to surpass the production growth rate because population
References: Malthus, T. R (1978).An Essay on the Principles of Population. Repetto, R. (1985), “Why doesn’t Julian Simon believe his own research?” Washington Post (November 2, 1985). Sarbapriya, R and Ishita, A.R (2012). Is Population Growth beneficial or detrimental for Economic Growth? An Indian Experience Savas (2008). The Relationship between Population and Economic growth: Empirical evidence from the Central Asian Economics Todaro, M. P. (1995), Reflections on economic development: The selected essays of Michael P