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1、Chapter 6 The Population Problem Chapter 6 covers the economic approach to population control.It begins with a presentation of perspectives on population growth.Little consensus exists on optimal population growth or level.How population and the development process affect each other is discussed.The
2、 effects of population growth on income inequality and the economic determinants of fertility are also discussed.Population growth is a significant source of nonsustainability.1.Discuss population growth rates from a historical and current perspective.2.Present the relevant public policy questions r
3、elated to population growth,e.g.,is alteration of the population growth appropriate and if so,how should it be achieved?3.Show the relationship between average product and marginal product and how average product is related to welfare.4.Illustrate how high population growth can retard per capita eco
4、nomic growth by decreasing the percentage of the population in the labor force.5.Present other arguments on population growth and economic growth and development.6.Discuss the relationship between population density and poverty.7.Present the theory of demographic transition.8.Relate the concept of e
5、conomic efficiency and sustainability to population control.9.Explore the population/environment connection.10.Illustrate the potential externalities associated with childbearing.11.Present the microeconomic theory of fertility.12.Show how economic incentives can shift the demand and/or marginal cos
6、t curves for children.13.Discuss the effects of population growth in urban areas.30 Tietenberg/Lewis Environmental and Natural Resource Economics,Eighth Edition I.Historical Perspective A.At current growth rates,the worlds population could double from its current figure of 6 billion people in just 5
7、0 years.B.Average rates of population growth have declined in most countries,especially in developed countries.C.Both fertility rates and birthrates have exhibited downward trends recently.D.Most developing countries are expected to have substantial increases in their populations.Poorer countries ar
8、e expected to contribute to 98%of population growth between 1998 and 2025.E.Population growth in the United States has followed a declining pattern primarily due to declines in the birthrate.Birthrates,however,do not account for age structure,i.e.,accounting for the number of persons of childbearing
9、 age and the number of children those persons are bearing.F.The Census Bureau uses the total fertility rate or the number of live births an average woman has in her lifetime to determine what level of fertility could lead to a stationary population.G.Between 2000 and 2005,world fertility rate averag
10、ed 2.7 live births per woman.Europe averaged a fertility ate of 1.4 during the same period and U.S.averaged 2.0 live births per woman.H.A stationary population is one in which the birthrate is constant and equal to the death rate.With a stationary population,the growth rate is zero.I.The replacement
11、 rate is the level of total fertility that is compatible with a stationary population.In the United States,the replacement rate is 2.11.J.Currently the total U.S.fertility rate is below the replacement rate.II.Effects of Population Growth on Economic Development This section attempts to address the
12、question of whether population growth has a negative or positive effect on economic growth.A.If the marginal product of an additional person is positive,then more people mean more output.This does not,however,imply anything about the desirability of population growth.B.If the marginal product of an
13、additional person is lower than the average product,then even though economic growth would increase in aggregate terms,a rising population reduces per capita welfare(on average).Explain the relationship between average and marginal.C.If the marginal product of additional people is greater than the a
14、verage product,population growth will increase both aggregate and per capita wealth.D.Output per capita is determined by the product of output per worker and the share of population that is in the labor force.E.The age structure effect is the effect of population growth on the percentage of people e
15、mployed.F.The youth effect arises when a rapidly growing population creates a large supply of people too young to work.G.The retirement effect arises from slow population growth creating a large percentage of persons who are over 65.H.Some developing countries are experiencing both youth and retirem
16、ent effects simultaneously.I.High population growth retards per capita economic growth by decreasing the percentage of the population in the labor force.Chapter 6 The Population Problem 31 J.The female availability effect,relates to the percentage of women available to join the labor force.K.The you
17、th effect and the female availability effect suggest that rapid population growth has a depressing effect on per capita growth.L.Examining the connections between population growth and capital accumulation suggests:1.Older populations are assumed to save more and thus rapidly growing populations(cet
18、eris paribus)are expected to save proportionately less.2.Lower savings leads to lower amounts of capital accumulation.3.Kelley and Schmidt(1994)found that population growth and demographic dependency had a negative effect on savings in the 1980s.4.The presence of a fixed factor of production might a
19、lso cause population growth to have a negative effect on economic development.The law of diminishing marginal productivity states that in the presence of a fixed amount of land,adding successively larger amounts of labor(a variable factor)will eventually drive the marginal product of labor down.When
20、 the marginal product falls below the average product,per capita income will decline if the population rises.M.Some theories suggest the oppositethat population growth enhances per capita growth.1.Technological progress can provide one means of escaping the law of diminishing marginal productivity i
21、f it increases marginal productivity.This can be illustrated graphically.2.Economies of scale are another source of increases in output per worker.Economies of scale exist when a doubling of inputs leads to a greater than doubling of output.Increasing populations will demand more output allowing for
22、 an exploitation of economies of scale.3.The relevant market for the exploitation of economies of scale is the global market unless trade restrictions are a significant barrier.N.Empirical studies can help to determine whether population growth enhances or retards economic growth.1.The National Rese
23、arch Council conducted one study and found:a.Slower population growth raises the amount of capital per worker and thus productivity per worker.b.Slower population growth is unlikely to result in a net reduction in agricultural productivity.In fact,agricultural productivity might rise.c.Population de
24、nsity and economies of scale are not significantly related.d.Rapid population growth puts more pressure on natural resources.2.Kelley and Schmidt(1994)found a negative impact of population growth on the rate of per capita output growth in the 1980s.This impact is larger in the less developed,more im
25、poverished countries.O.Slower population growth reduces income inequality.P.Examples in Africa,Bangladesh,Brazil,and Southeast Asia are highlighted to show the negative environmental effects of population density and poverty.32 Tietenberg/Lewis Environmental and Natural Resource Economics,Eighth Edi
26、tion III.The Population/Environment Connection A.Population growth is also linked to environmental degradation.B.Population density,combined with poverty,has significant negative effects on environmental quality.Deforestation and changing land use are outcomes.C.Use of marginal lands leads to topsoi
27、l losses.D.Boserup writes about the“induced innovation hypothesis”which says that increasing populations trigger increased demand for agricultural goods.Land scarcity,however,results in agricultural innovations and increased sustainability.E.The opposite view,the“downward spiral hypothesis,”posits p
28、overty and degradation are reinforcing.F.Either type of behavior could result,depending on the situation,according to Pender(1998).G.Tiffen and Mortimer(2002)find evidence to support negative feedback effects.IV.Effects of Economic Development on Population Growth This section examines whether econo
29、mic development effects population growth.In other words,does high income cause lower population growth rates?A.The theory of demographic transition suggests that as nations develop,they eventually reach a point at which birthrates fall.B.The theory of demographic transition suggests that there are
30、three stages of population growth.1.Stage 1 is the period immediately prior to industrialization,during which time birthrates are stable and are slightly higher than death rates.2.Stage 2 is the period immediately following the initiation of industrialization,during which time death rates fall drama
31、tically with no change in birthrates.The reduction in mortality causes a rise in the population growth rate.3.Stage 3 is the period of demographic transition which involves large declines in the birthrate that exceed continued declines in the death rate.This period involves further increases in life
32、 expectancy,but smaller population growth rates than in Stage 2.C.The theory of demographic transition suggests that reductions in population growth might accompany rising standards of living.D.The theory of demographic transition does not answer such questions as why birthrates eventually fall or i
33、f lower-income countries will automatically experience the transition.E.Another weakness of the theory relates to the effect of HIV/AIDs on death rates.In some Sub-Saharan African countries,large increases in death rates are causing populations to decline.In 2005,13.2 million adult women in Sub-Saha
34、ran Africa were infected V.The Economic Approach to Population Control This section tries to answer the question of whether or not population control is efficient.In other words,are there biases toward overpopulation?Will adults make efficient childbearing decisions?A.Childbearing decisions impose e
35、xternal costs outside the family.B.The prices of childrearing or childbearing goods and services may send the wrong signals.C.Congestion externalities will arise if more people are added to limited space.Congestion externalities are one source of market failure.D.These external costs are intensified
36、 if the resource base is treated as an open access,common pool resource.Chapter 6 The Population Problem 33 E.Income equality is a public good.High population growth may exacerbate income inequality.F.Due to external costs and benefits,decisions that may be optimal for individual families will resul
37、t in inefficiently large populations.G.Subsidized food artificially lowers the cost of children.Tax financed education provides an incentive to have more children as the marginal cost of the education of an additional child is lower than the true social cost.H.Population control is a politically sen
38、sitive topic.I.Successful population control involves lowering the desired family size and providing sufficient access to contraception and family planning information.J.The economic approach to population control is aimed at indirectly lowering the desired family size.K.The microeconomic theory of
39、fertility attempts to assess the determinants of childbirth decisions from an economic perspective.This theory begins with the viewpoint that children are consumer durables and the demand for them will be downward sloping.L.As in any market with a negative externality,reducing demand(marginal benefi
40、ts)or raising marginal costs can move the equilibrium toward the economically efficient outcome.M.Examples of policies that might reduce demand include a shift toward an industrial economy where child labor is not necessary;providing income security to the elderly;decreasing infant mortality;and red
41、ucing income inequality and increasing employment opportunities.N.Examples of policies that would increase the marginal costs are also listed and include raising the opportunity cost of the mothers time through education and employment opportunities and increasing housing and education costs.O.Polic
42、ies must be carefully thought out so as to avoid inequitable policies.P.Studies on this subject suggest:1.Greater family wealth sustains higher education levels and health.2.A rise in the value of the mothers time has a positive effect on the demand for contraception and a negative effect on fertili
43、ty.3.A rise in the value of the fathers earnings has a positive effect on family size,child health,and education.4.An increase in a mothers education has a negative effect on fertility and infant mortality and a positive effect on childrens schooling.Q.Womens income earning potential can be increase
44、d through investment in human capital or physical capital.Funds for investment,however,are needed from banks which require collateral.In some developing countries,women cannot own property and thus have no collateral.R.An innovative solution has been used by a bank in Bangladesh.Small loans are made
45、 and when these are repaid,members are eligible for additional loans.Repayment rates have been very high.S.These programs must be combined with access to birth control information.T.Additionally,in a World Bank study,Summers(1992)found that the rate of return on investment in power plants in develop
46、ing countries averaged less than 4 percent,while investments in education for girls returned 20 percent or more.34 Tietenberg/Lewis Environmental and Natural Resource Economics,Eighth Edition If students have not seen total product curves and learned how to derive marginal and average product curves
47、,then some of this material might be quite difficult.They will need to be shown the relationship between average and marginal product.The idea of“efficient childbearing,”while not inherently confusing,is likely to be controversial and might spark some lively discussion.Holding a discussion on the va
48、rious means that have been used to control population growth and the successes and failures of some programs might be very interesting.Make sure to keep focusing the discussion around the concepts of economic efficiency and sustainability as much as possible as it will likely be a lively discussion.
49、This might also be a good time to introduce students to basic research and to economic and demographic data.It could prove interesting to ask each student to bring to class statistics on some of the basic measures discussed in this class,e.g.,life expectancy rates,birthrates,economic development statistics,etc.Perhaps ask them to see if they can find identical statistics for one developed and one developing country.Ask for examples during the next class.Are development and the reduction of population pressure on the environment compatible or conflicting objectives?