David R. Henderson  

From the Vault: My 1983 Memo on Population Growth

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I came across the following memo that I wrote while a senior economist with President Reagan's Council of Economic Advisers. My main duty in that job was to fight off bad ideas, mainly from within the Administration. If I had any time left, I got to fight off bad ideas from Congress.

TO: P.H. Gatje, NOAA
FROM: David Henderson, CEA (395-6982)
SUBJECT: Comments on Population Growth Issue Paper

Major Criticism

This paper is premissed on the idea that reducing population growth hastens economic progress. However, the author simply asserts the premise rather than documenting it. In fact, it can't be documented because it's not true. Hong Kong has had a seven-fold increase in population since World War II along with substantial increases in standards of living. The United States population has increased dramatically in the last two centuries as has our standard of living. The attached table shows the non-relationship between population growth and the growth of living standards. [I attached a table from Julian Simon's 1981 edition of The Ultimate Resource; the table showed the lack of a relationship between population growth and economic growth.]

Moreover, the one piece of evidence the author gives on the relationship between population growth and economic progress refutes his premise. The author states on page 6 that:

During the 1960-1980 period, the world experienced the highest rate of population growth in recorded human history, the largest numerical increase in population--and also the highest rate of global economic growth.
Why does the author ignore this evidence throughout the rest of the paper?

Other criticisms

. The author states (p. 6) that the crucial factor in the widening per capita income gap between North and South throughout the 1960-1980 period was the greater population growth in the South. The clear implication that the author draws is that greater population growth harmed the South relative to the North. But to draw this implication, the author would have to establish that the growth of per capita income in the South was less than that of the North. In fact, the opposite is true, witness the fact that the proportionate gap is shrinking. We would expect the absolute gap to widen even if the South grows faster than the North, simply because the North started from a much higher level.

. The author states that it is generally agreed that:

The formulation of specific population policies is a sovereign right of national governments.
Does the author seriously mean this? Has the U.S. government reversed the position it took during the Nuremberg trials that government officials who try to decimate whole races of people are guilty of crimes?

cc: Tom Magness, CEQ
L. Giffler, State
S. Overson, State
D. Gillespie, AID
K. Pietmeyer, AID
S. Baum, Census


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COMMENTS (6 to date)
Steve Roth writes:

>non-relationship between population growth and the growth of living standards

Pretty compelling in suggesting that controlling population should not be a priority. (I agree with that, of course, fwiw.)

So when you learn that among prosperous countries, there is a non-relationship between government size and the growth of living standards, you should conclude that limiting government size should not be a priority, right?

Gotta fight off bad ideas wherever you see 'em...

Robert Scarth writes:

"you should conclude that limiting government size should not be a priority"

It depends why you want to limit the size of government. If your reason for limiting government is that doing so will increase growth then yes, you would have to agree that it is not a priority. However if your reason for limiting government is that doing so will increase liberty then you would not change your view on its priority; in fact you could point out that doing so would not reduce the growth of living standards.

Boonton writes:

Are you measuring economic growth by GDP or GDP per capita? I agree I don't believe there's a negative correlation between population and growth but I also don't think the opposite has been established, namely that population growth is always a positive.

Charlie writes:

"The formulation of specific population policies is a sovereign right of national governments."

"Does the author seriously mean this? Has the U.S. government reversed the position it took during the Nuremberg trials that government officials who try to decimate whole races of people are guilty of crimes?"

I don't understand why you interpret "specific population policies" as commit genocide. If I read this, I'd worry your memo misrepresents the entire paper.

Charlie writes:

I realize my previous comment made an assumption that the original paper was advocating "specific population policies" other than genocide. If on the other hand, you stopped a paper advocating mass extermination of entire races from soaring up the ranks of the Reagan administration. Good work!

Brian Clendinen writes:

I wish I had this info in 2003 when I was taking my Economic Development class. I never liked the idea personally and something never seemed right to me with the idea high population growth reduces GDP per Capita. However, all the data I was shown appeared to pretty conclusively prove the point, so I had to believe the data. It always nice to know years later the data tends to prove you where right that it should not really matter on its own. I remember when I stated this concept to a few of my female friends who were in their early 20’s. They were revolted by the idea that somehow having to many children was economic harmful. I told them it was what the data showed, not that I disagreed with them.

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