Demographic Transition

The differences in the wealth of nations have been in existence historically. The extent of inequalities has been very large and even today they do exist and hence the phenomenon is disturbing. It is an undisputed fact that population of a country does have some effect on the economic growth of a country but the extent to which the population size and composition affects the economy has been a subject of debate and research. On one extreme, there is a pessimistic view, originally propagated by Malthus that population growth tends to depress income growth, as growing population is a drain on the national resources. On the other extreme is an optimistic view that population growth creates opportunities for development by optimum productive exploitation of the available resources that results in capital accumulation and income growth. Recent empirical evidence, however, sets aside both the pessimistic as well as the optimistic views on the effect of population growth on per capita income, which is a good indicator for measuring economic wellbeing of nations. The view called as ‘Population Neutralism’ had started emerging since 1980s. However, it took about two decades to expel the belief that population growth was the sole important indicator of demographic change. From the beginning of 21st century, people have pointed out that population age structure is perhaps more important a factor than the total population.