Population and economic growth: Ancient and modern

Abstract

This paper focuses on the evolution of the relationship between population and economic growth from Hume to New Growth Theory. In this paper, we show that there were two main views on the subject. There were those who assumed that the relationship between fertility rate and income was positive. On the other hand, there were those who raised the possibility that this linkage did not occur, and they emphasised that an increase in income did not necessarily lead to having more children. Following from Hicks’ methodological precept, the paper will show that their position on the issue was related to a socio-economic fact: the sibship size effect. We show that those who took the view that an increase in income leads to the desire to have more children did not take into consideration the sibship size effect, while those maintaining that there existed a negative relationship introduced into their utility function a sibship size effect.

Keywords:

• Population
• economic growth
• sibship size effect
• children
• fertility rates

JEL Classifications:

• B10
• D10
• J13

Acknowledgements

We wish to thank the editor, the referees, as well as Sam Hollander, Christina Marcuzzo, Joel Mokyr, and seminar participants at Strasbourg University, Tel-Aviv University, and also participants at the Hume Conference in Ben-Gurion University, sponsored by the Thomas Guggenheim programme, for their helpful comments.

Notes

1 See Galor (2011) which presents the Unified Growth Theory and the theoretical trade-off between the quantity and quality of children. Klemp and Weisdorf (2012), among others, for example, are empirically and not theoretically based and will not be discussed here.

2 We thank an anonymous referee for reminding us that great caution should be taken in invoking macro-data related to the pre-1600 period.

3 There have also been variant interpretations of the population history of the UK and the hypothesis linking means of production with attitudes to reproduction (Laslett, 1969; Smith, 1981; Wrigley and Schofield, 1981). Indeed, the Malthusian demographic system was, according to Smith (1981, p. 615), “most likely in existence” when More's Utopia [1516], as well as Das Kapital [1867], appeared.

4 Desai (1995, p.198).

5 On the effects of sibship size in terms of the resource dilution theory, see Guo and VanWey (1999), Downey et al. (1999), King (1987), and also Phillips (1999).

6 We thank an anonymous referee for suggesting us to include a short section on Cantillon and Smith.

7 Indeed, we would like to emphasise that Marx had a divergence of views with Hume. It should be recalled that Marx and Engels criticised Hume in the context of their critique of Dühring, especially regarding the originality of Hume's monetary thought (Krause, 2002, p. 356). In this paper, we will focus on the subject of population.

8 An increase in population was in the interest of the elite, as it reverses the “reserve army” of labour, and thus pushed down wages.

9 We thank Sam Hollander for pointing this out to us.

10 Of course, we could use only one subutility function U, such that W = U. Since in the literature many models take two different utility functions, we follow this assumption. The utility of the child's consumption, while being a child, is omitted in many papers, and we follow this form of modelling.