International economic and financial implications of the population explosion

Summary

Much international trade and its associated international payments are based on comparative population differences. Differences in population ‘density’, as reflected in different ratios of available labour force to existing usable land, result in different factor prices, hence different product prices and hence different international trade movements. A less obvious cause of trade is differences in population growth-rates, and especially in fertility rates, as these last affect the age distribution of the population and labour force, the relative availability of capital again, and resultant per capita incomes. Per capita income differences in turn occasion different rates of saving, as represented both by domestic capital accumulations and net export balances. Moreover, nations with high fertility rates cannot compatibly aspire to high rates of improvement in per capita income, so that if they borrow abroad for their economic development they are less likely ever to repay these debts. While high fertility often results in high population density, especially in lands of ancient culture, this is not always so. Moreover, while the public recognises that high population density can sometimes be a cause of poverty, it less clearly recognises that high fertility is always an economic handicap regardless of the relative availability of natural resources.