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Population Growth and Economic Development: Policy Sons Working Group on Population Growth and Economic Development Committee on Population Commission on Behavioral and Social Sciences and Education National Research Council NATIONAL ACADEMY PRESS Washington, D.C. 1986

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NATIONAL ACADEMY PRESS 2101 Constitution Avenue NW Washington, DC 20418 NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineenng, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance. This report has been reviewed by a group other than the authors according to procedures approved by a Report Review Committee consisting of members of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The National Research Council was established by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy's purposes of furthering knowledge and of advising the federal government. 7 he Council operates in accordance with general policies detained by the Academy under the authority of its congressional charter of 1863, which establishes the Academy as a private, nonprofit, self-governing membership corpora- tion. The Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineenng in the conduct of their services to the government, the public, and the scientific and engineering communities. It is administered jointly by both Academies and the Institute of Medicine. The National Academy of Engineenng and the Institute of Medicine were established in 1964 and 1970, respectively, under the charter of the National Academy of Sciences. Library of Congress Cataloging Publication Data Population growth and economic development. Bibliography: p. Includes index. 1. Developing countries Population. 2. Developing countries Economic conditions. I. Na- tional Research Council (U.S.). Working Group on Population Growth and Economic Develop- ment. HB884.P6655 1986 ISBN 0-309-03641-0 304.6'09172'4 86-862 Cover photograph ~ Don Rutledge, Taurus Photos, Inc. We gratefully acknowledge the assistance we received from the TyX Corporation, Reston, Virginia, which provided access to electronic pagination and laser-pnnter technology for producing camera copy. Printed in the United States of Amenca. First Priming, Marchl986 Second Priming, July 1988 Third Printing, December1989 Fourd~Prinung, Novemberl990 Fifth Printing, (October 1991

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Working Group on Population Growth and Economic Development D. GALE JOHNSON (Cochair), Department of Economics, University of Chicago RONALD D. LEE (Cochair), Graduate Group in Demography, University of California, Berkeley NANCY BIRDSALL, Population, Health, and Nutrition Department, The World Bank, Washington, D.C. RODOLFO A. BULATAO, Population, Health, and Nutntion Department, The World Bank, Washington, D.C. EVA MUELLER, Population Studies Center, University of Michigan SAMUEL H. PRESTON, Population Studies Center, University of Pennsylvania T. PAUL SCHULTZ, Department of Economics, Yale University T. N. SRINIVASAN, Department of Economics, Yale University ANNE D. WILLIAMS, Department of Economics, Bates College KENNETH M. CHOMITZ, National Research Council Fellow GEOFFREY GREENE, Research Associate . . .

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Committee on Population 1983-1985 EUGENE HAMMEL (Chair), Graduate Group in Demography, University of California, Berkeley RUDOLF ANDORKA, Hungarian Academy of Sciences, Budapest NANCY BIRDSALL, Population, Health, and Nutrition Department, The World Bank, Washington, D.C. RODOLFO A. BULATAO, Population, Health, and Nutrition Department, The World Bank, Washington, D.C. RONALD FREEDMAN, Population Studies Center, University of Michigan SIDNEY GOLDSTEIN, Population Studies and Training Center, Brown University PHILIP LEE, Institute of Health Policy Studies, University of California, San Francisco ~ GEOFFREY MCNICOLL, Center for Policy Studies, The Population Council, New York JANE MENKEN, Office of Population Research, Princeton University ANN MILLER, Population Studies Center, University of Pennsylvania JOAN NELSON, Overseas Development Council, Washington, D.C. SAMUEL H. PRESTON, Population Studies Center, University of Pennsylvania GEORGE B. SIMMONS, Department of Health Planning and Administration, University of Michigan CHARLES F. WESTOFF, Office of Population Research, Princeton University ANNE D. WILLIAMS, Department of Economics, Bates College ROBERT I. LAPHAM, Study Director 1V

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Contents Preface Introduction .... V11 1 Will slower population growth increase the growth rate of per capita income through increasing per capita availability of exhaustible resources? 2 Will slower population growth increase the growth rate of per capita income through increasing per capita availability of renewable resources? .... 3 Will slower population growth alleviate pollution and the degradation of the natural environment? 4 Will slower population growth lead to more capital per worker, thereby increasing per worker output and consumption? 18 ..... 35 ... 40

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V1 Do lower population densities lead to lower per capita incomes via a reduced stimulus to technological innovation and reduced exploitation economies of scale in production and infrastructure? ............................... 6 Will slower population growth increase per capita levels of schooling and health? .................. 7 Will slower population growth decrease the degree of inequality in the distribution of income? Will slower population growth facilitate the absorption of workers into the modern economic sector and alleviate problems of urban growth? 9 Can a couple's fertility behavior impose costs on society at large? ............................. Conclusion References . . . Index CONTENTS ..... 47 .... 53 .. 62 ..... 66 78 85 94 .... 105

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Preface This report summarizes evidence on the relationships between population growth and economic development, concentrating on the developing nations. Following an introduction that sets forth the problem, the report addresses nine relevant and currently debated major questions bearing on these relationships and then summarizes the conclusions in a final chapter. In 1963 the Panel on Population Problems of the Committee on Science and Public Policy of the National Academy of Sciences published a report entitled The Growth of World Population. The appointment of that panel and the publication of its report were expressions of concern then felt by scientists, as well as by other informed persons in many countries, about the implications of population trends. At that time, the most consequential trend was the pro- nounced and long-continued acceleration in the rate of increase of the popula- tion of the world, especially in the poorer countries. It was estimated in 1963 that the annual rate of increase of the global population had reached 2 percent, a rate that would lead to a doubling of Me population every 35 years. The disproportionate contribution of low-income areas to that acceleration was caused by rapid declines in mortality combined with high fertility that re- mained almost unchanged. Since 1963, however, the peak of the rate of growth in the world's popula- tion has been passed. A dramatic decline in the birth rate in almost all the developed countries has lowered their aggregate annual rate of increase to well below 1 percent, and the rate of increase has also declined in the developing countries as a whole. In some low-income areas, a sham decline in fertility has more than offset the growth-inducing effect of the generally continued reduc- tion in the death rate, although the rate of population increase remains high in many developing countries. . . V11

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. . . V111 PREFACE Debate continued about the relationships between population growth and economic development. The National Academy of Sciences, through a study committee of the Office of the Foreign Secretary chaired by Roger Revelle, and with support from the Agency for International Development (AID), examined the issue and in 1971 published a two-volume report entitled Rapid Population Growth: Consequences and Policy Implications. A dozen years later, in response to the ongoing debate about population growth, associated especially with the publication of several major works discussed in the introduction to this report, AID again asked the Academy to undertake an assessment. The Rockefeller Foundation and the William and Flora Hewlett Foundation also supported the work, as did the National Acade- my of Sciences and the National Academy of Engineering through the NRC Fund.* With this support, the report presented here was prepared by the Working Group on Population Growth and Economic Development of the Committee on Population. The report follows a series of publications by the predecessor Committee on Population and Demography, which evaluated evidence on levels and trends of fertility and mortality in selected developing nations, worked on the improvement of technologies for estimating fertility and mortality where only incomplete or inadequate data existed, and evaluated the factors determining the changes in birth rates in developing countnes. (A list of reports produced under this work Dro~rarn is found on the inside back , ~ cover.) This report considers the consequences of population growth for economic systems. Historically, the issue originated as one of concern for the deleterious consequences of rapid population growth: some analysts clearly saw disaster in the offing if the then-current rates of growth continued; others saw no problem at all. Those positions which might be called the extreme environmentalist and extreme mercantilist views-are considered herein, as well as the more moderate positions favored by many scholars. This report finds little support for either the most alarmist or the most complacent views concerning the economic effects of population grown. The Working Group on Population Growth and Economic Development The National Research Council (NRC) Fund is a pool of private, discretionary, nonfederal funds that is used to support a program of Academy-initiated studies of national issues in which science and technology figure significantly. The NRC Fund consists of contributions from a consortium of private foundations including the Carnegie Corporation of New Yorlc, the Charles E. Culpeper Foundation, the William and Flora Hewlett Foundation, the John D. and Catherine T. MacArthur Foundation, the Andrew W. Mellon Foundation, the Rockefeller Foundation, and the Alfred P. Sloan Foundation; the Academy Industry Program, which seeks annual contributions from companies that are concerned with the health of U.S. science and technology and with public policy issues with technological content; and the National Academy of Sciences and the National Academy of Engineering endowments.

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PREFACE 1X also commissioned a group of background papers that cover in technical detail the topics summarized here; these are cited throughout. In addition, a second activity of the Committee on Population, the Working Group on Family Planning Effectiveness, is completing a major assessment on what is known about the operation and management of family planning programs in the developing world. In carrying out its mandate, the Working Group on Population Growth and Economic Development met several times and conducted a workshop to review early drafts of background papers and to begin to synthesize the findings for this report. Several authors of the papers attended the workshop along with working group members. The committee and the National Research Council are grateful to these authors and especially to the members of the working group for their diligence in struggling with complex issues. All the working group members contributed ideas and reactions as the report pro- gressed through many drafts. Particular appreciation is due to working group member Samuel Preston, who had principal responsibility for the initial drafting of the report; to cochair Ronald D. Lee and research associate Geoffrey Greene, who were also instrumental in early drafts of the report; and to Kenneth M. Chomitz, NRC fellow, who assisted with the drafting and coordination of the final text. Thanks are also expressed to the other members of the committee staff, who helped organize the working group and provided necessary support throughout the project. These include Robert J. Lapham and Peter J. Donaldson, study directors at the beginning and end of the project; Diane Lindley, research assistant; and Cheryl Halley, administrative secretary. In addition, Eugenia Grohman, associate director for reports of the Commission on Behavioral and Social Sciences and Education, and Elaine McGarraugh, production editor, applied their unusual editorial talents to the report. The committee is grateful to all the working group members and committee staff for their efforts on this report. Eugene Hammel, Chair Committee on Population

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Population Growth and Economic Development: PoUcy ~1 t

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