UN Population Division, Department of Economic and Social Affairs,
with support from the UN Population Fund (UNFPA)
************************************************************************* For further information please contact the United Nations Population Fund at 220 East 42nd Street, New York, NY 10017 USA or via email: firstname.lastname@example.org ************************************************************************** FROM: Population Growth and Economic Development: Report on the Consultative Meeting of Economists Convened by the United Nations Population Fund, 28-29 September 1992, New York. New York:UNFPA, 1993. STATEMENT ON POPULATION GROWTH AND ECONOMIC DEVELOPMENT Adopted by Consultative Meeting Participants by Consensus I. Policy and Research Challenges in the 1990s During the 1980s, a number of economists (many occupying key positions as policy advisers) have asserted that population is either a neutral factor vis-…-vis economic growth and development, or that its importance is being overplayed by aid donors and family planning advocates. At the same time, leaders in a growing number of developing countries have become even more convinced of the need to slow rapid population growth. In part, this is a result of more open, responsive governance in many countries. Leaders see immediate problems associated with high population growth. They are convinced that organized interventions can do something to slow population growth and that such a slow-down brings benefits to individuals and society; also that the community wants and is responsive to family planning programmes. The important question thus arises: How to bridge this gap, actual or perceived, between current research findings and the policy community's need for guidance for action in the population field. In our view, the answer is to broaden the population debate, to get beyond the narrow focus on population and growth of income per capita that one finds in heuristic models and economists' rejection of them, and to focus on problems associated with population pressures that are both specific and tractable. There is a need to increase recognition among researcher- advisers that policy makers must make decisions now þ in the face of probable (though still, in some instances, unconfirmed) consequences of further delays in checking demographic momentum. Demographers make a compelling case that the time for action is now, even if it is unlikely that fully satisfying knowledge about adverse consequences is possible in the near term. How can we apply the precautionary principle? How can we use an imperfect knowledge base to inform decisions that have to be made under uncertainty? To start with, it is important to understand the history of the population debate. II. Origins of Consensus and Commitment to Action on Population A. The Nature of the Consensus Formed in the 1960s The consensus of the 1960s was based on recognition of the health and welfare benefits of family planning for individuals; and of the human rights aspect as reflected in access to safe, effective contraceptive methods. It drew on growing concern about the acceleration of population growth in developing countries (that resulted from rapid decline in mortality while fertility remained high), occurring at a time when these countries were also beginning efforts to raise living standards; in particular, there was concern that rapid population growth would inhibit the development required to bring down birth rates. There were limitations in the knowledge base of that period. It was felt, for example, that the European experience of "demographic transition" would be too onerous if repeated in developing countries. Moreover, discussion of macroeconomic consequences relied on heuristic models, using 1950s-vintage economic-growth models, to show that the young age distribution associated with high fertility would lower investments needed to boost production for the increasing number of consumers. Despite lack of definitive research evidence to support interventions to slow population growth rates, there was policy-level consensus of a strong presumptive case for intervention justified by indisputable benefits to individuals and probable benefits to society. B. Mobilization of Political and Financial Support for Population Interventions in the 1970s Most research during the 1970s was focused on understanding reproductive behaviour and how interventions might accelerate fertility decline. Few questioned the premise that fertility decline was necess-ary; most agreed that research was needed to help find out how to do this more effectively. There was surprisingly little research on consequences of rapid population growth, except replication of heuristic exercises aimed at expanding political support. Some theoretical work took place, such as refinements of growth models, but little empirical work was undertaken to expand the knowledge base about population/development links or macroeconomic consequences. III. Revisionist View of Macroeconomic Consequences in 1980s During the early 1980s, there was renewed interest by research community in macroeconomic effects of population growth, in part a response to the strong counter-attacks by Professor Julian Simon. This struck a chord of sympathy from mainstream economists who had been sceptical all along about the arguments used to justify the earlier consensus. Also, many economists rejected the rigid structural-growth models of 1950s, being more interested in market responses and "getting the prices right". The 1986 report of the U.S. National Academy of Sciences played a catalytic role in legitimizing this "revisionist" view. Even though the report acknowledged that rapid population growth could cause problems for developing countries, its very cautious review of the evidence on adverse economic effect of rapid population growth was generally seen as a rejection of the earlier consensus. Concurrently, research findings continued to be positive about the benefits for health, education, welfare and women's status to be gained by improving access to safe, effective family planning. The few economists who focused on population issues mainly took a laissez-faire or "agnostic" position on macro issues but supported interventions on individual welfare grounds. Some granted that rapid population growth could aggravate development problems, but noted that population fell fairly low on the list of causes of those problems. Other causes (poor management, distorted incentives, etc.) need to be attacked directly. These economists were also open to interventions to correct market failure due to poor information, distorted prices and externalities. Family planning intervention to enhance societal equity was also seen by them as justified. IV. Status of Current Knowledge Base and Implications for Population Policy Nothing in economic-demographic research contradicts the proposition that in low-income countries with considerable backlogs in human development, living standards and infrastructure, population growth in excess of 2 per cent per year is among the structural factors inhibiting the achievement of a wide range of development objectives. In many countries and circumstances, the longer-run implications of rapid population growth, particularly pressure on renewable resources, are severe. Environmental pressures vary in the extent to which they are driven by population growth as opposed to other factors such as technology, income growth, policies, etc. But the food-soil-water relationship is strongly related to population and individual countries which face these problems already are likely to be acutely affected in the future. In such circumstances, a difference of a decade in the onset of the transition to lower population growth can make a considerable, even essential difference. Rapid growth in labour-force entrants is a source of stress in capital-poor economies; in countries where rapid growth of the school-age population has also contributed to the erosion of investments in human resources, the potential gains that might have accrued from having a rapidly growing stock of younger workers are offset by lower productivity of workers and reduced competitiveness in a global economy where gains from trade depend primarily on productivity. When low productivity is coupled with low earnings, efforts to alleviate poverty are undercut. It is easy to recommend more investment in social sectors as a remedy to poverty, but difficult to do that if productivity is so low that neither workers nor Governments are likely to accumulate the surpluses required to make such investments. New evidence from 1980s data shows a negative correlation of high rates of population growth and the growth of per capita income. We urge, however, that findings be interpreted cautiously, as indicative of problems associated with rapid population growth in countries that have not done well. Countries that have slowed population growth rates and are now doing comparatively better should also be examined. Attention should be focused on specific issues: falling behind in human resource investments; poor governance in face of population pressures; unsustainable efforts to increase food production; strains on water resources; other issues that are of immediate concern to policy makers þ as well as long-run issues associated with lower versus higher population stabilization. We also note that recognition of the adverse effects of rapid population growth does not mean that acceleration of the transition to lower growth will by itself solve all developmental problems; at best it may buy time to deal with those problems or keep them from getting even worse. Most of the immediate benefits to slowing population growth through increasing access to family planning accrue to individuals through the welfare and equity benefits of being able to time and space births more effectively and with less risk to health. Subsidized family planning services may also help to bring the individual costs of an added birth better into line with societal costs thus reducing externalities (costs of children borne by society at large, but not by individual families). When interventions are motivated by both individual and societal objectives, respect for the reproductive rights and health of individuals should be an added focus of attention. V. Recommendations The research community should continue to broaden and deepen the knowledge base for population policy. Research efforts should focus on problems in countries where population pressures appear serious and on the specific aspects of the problem that particularly affect those countries. An examination of economic benefits in countries that have successfully slowed population growth should also be given priority. Further, research should probe specific under-served groups in countries where market failures may be depriving such groups from obtaining benefits from family planning and reproductive health services. The research community should also strive to make progress in estimating costs and resource requirements for population interventions. Analysis of the impact of population on a broad range of development issues has not received the serious attention it should have. Implications for poverty alleviation þ particularly in rural areas þ and infrastructure investment, as well as other issues, stand out in this regard. An enormous increase in the population of developing countries over the next three to four decades is inevitable. Understanding the impacts of this increase is not just a matter of defending or rebutting the assertions that have dominated the population debate during the 1980s: it is a matter of great policy relevance. Those actions that make sense on micro-level grounds, including benefits for human rights, equity and women's status, (whether or not a strong macroeconomic rationale can be established) should be taken immediately. This list certainly includes striving to meet the existing and growing unmet need for quality family planning and reproductive health services and to expand educational and other opportunities for women. Also, we recognize that government can play an important role in legitimizing family planning as well as providing information and services. Ways should be explored for the research community to do a better job at informing the policy process about rationales for intervention and help policy makers deal with complexities of population-development links. Agnosticism may be safe for researchers, but it is not helpful at the policy level. Do researchers really intend to deny the validity of interventions? Do they want to limit themselves to debunking naive, alarmist approaches to consequences? A more constructive approach would be to help decision makers to weigh risks, benefits and costs of actions/inaction and to make enlightened decisions on the basis of knowledge that we now possess, however imperfect it is.