3 - Population, economic growth and resource constraints

Summary

Historical trends in population growth

Economics is sometimes called the dismal science because many of its pioneers expressed pessimism about the possibility of sustained economic growth in a world of limited resources. We meet this view today in the worries about shortages of raw materials, such as oil, eventually putting an end to economic growth. Late nineteenth-century economists worried about coal shortages, but the concern today is rather that coal generates too much CO₂, which might in the long run harm growth. The first economist to develop a coherent theory of limited resources as a binding constraint for sustained long-term economic growth was Thomas Malthus (1766–1834), whose An Essay on the Principle of Population was first published in 1798. The date of publication is not without interest, since it falls within the first decades of the Industrial Revolution in Britain, which combined unprecedented population growth with increasing (or at least constant) income per head. Malthus argued that given limited land the supply of food would eventually constrain income and population growth. We will soon return to a detailed exposition of the Malthusian view, but we will first review the evidence on long-term population growth in Europe. Reasonably precise population estimates are available only from the sixteenth century onward; before that, populations are estimated from projections based on scarce data and conjectures of the carrying capacity of a given area using the prevailing technology.