7 ms·

Is there a version of economic thought that doesn't necessitate constant population growth? Why is low fertility rate seen as a bad thing? Often engineering i

Is there a version of economic thought that doesn't necessitate constant population growth? Why is low fertility rate seen as a bad thing? Often engineering is argued in terms of tradeoffs or meeting certain requirements. Rather than follow economic theories that depend on growth, can we develop economic theories that adapt to the trends of the population rather than the other way around(Musks' need for cheap labor not withstanding). Is there a version of the world where we have less people with a collective higher quality of life, particularly as technology improves individual productivity? What about the vintage-futurism economic dream of 10 hour workweeks?

xnx 4y ago
I'd love an economic system that championed efficiency over growth.
- bombcar 4y ago
  I've seen arguments that almost all of the economic growth over the last 100+ years is directly attributable to population growth and very little else.
  - gruez 4y ago
    Source? That would imply total factor productivity didn't grow at all "over the last 100+ years", which seems doubtful given all the innovations brought about during that time period.
    - mellavora 4y ago
      I don't have a source, nor do I fully believe the original poster, but do consider: 7x population growth, shift from 80% rural to 90% urban. Where "rural" is low economic engagement and "urban" is a job-holder. shift from single-earning families to dual-earner, where again a stay-at-home mom does not increase the size of the economy while a working one does (and please, I know this is unfair and the tremendous value a full time Mom provides). Multiple these three shifts and you get a pretty big increase in the economy, with zero increase in productivity.
      - bombcar 4y ago
        That's the basic argument, which I don't have at hand, but there have been some very specific "improvement in output" moments in history but those are in the long past and most of what we have now over time is basically the same as growth of population in the US.
- imtringued 4y ago
  Freiwirtschaft...
missedthecue 4y ago
Capitalism doesn't require for constant population growth. But public pension schemes do. And there are geopolitical advantages to being bigger than your foes. Look at Japan. Japan's population has been on the decline for about 1.5 generations. They still get as much food, shelter, and entertainment as any other developed economy. They have hobbies, travel, discretionary income... The worries there aren't about capitalism failing. Demographic collapse just has a lot of nasty social consequences in general. An inverted pyramid spells pain for future generations.
- cs137 4y ago
  Public pensions are pretty much gone these days, for better or worse. I don't think an inverted pyramid is as bad as it sounds. It's a check against ageism and falling wages (there's no longer a horde of hungry young people who want the jobs) and, given how little of the work people do is actually necessary--white-collar jobs are 85% sending passive-aggressive emails--I think society can afford it. It might be the only thing that provides enough value of labor to keep conditions relatively humane.
  - missedthecue 4y ago
    By public pension, I mean what we in the US call Social Security. Most developed economies have an equivalent.
  - lotsofpulp 4y ago
    > Public pensions are pretty much gone these days, for better or worse. Taxpayer funded (which is what “public” generally means) pensions are basically the only defined benefit pensions left in the US. I do not know of a single city, county, state, or federal government that has gotten rid of them, especially not for cops.
    - dragonwriter 4y ago
      “public pensions” usually refers to schemes like social security in the US. “public employee pensions” are a different thing. (But neither is gone, in general or in the US, though more and more government employee positions in the US are relying more on defined contribution retirement plans and less on defined benefit pensions.)
dfxm12 4y ago
Why is low fertility rate seen as a bad thing? It's mostly seen as a bad thing in the lens of ethnic nationalist ideology that low fertility rates will change the demographics of a country (see Great Replacement [0]). After all, if Musk (and other capitalists) needed, they can get labor from other countries south of America's borders, but there is a push to not make these workers Americans! This isn't an issue only in America either. 0 - https://en.wikipedia.org/wiki/Great_Replacement https://en.wikipedia.org/wiki/Great_Replacement
- bombcar 4y ago
  Importing workers fails for the world as a whole, and the number of countries that easy importation works for is also declining.
- antiverse 4y ago
  >https://en.wikipedia.org/wiki/Great_Replacement https://en.wikipedia.org/wiki/Great_Replacement >[...] is a white nationalist far-right conspiracy theory [...] Native Americans would disagree.
  - cgrealy 4y ago
    The "Great Replacement" theory originated in the 2010s and is specifically about white people being replaced (in case anyone was in any doubt, it's racist bullshit). It's a (bullshit paranoid) predictive theory about the modern day that has nothing to do with the historical genocide of Native Americans by white people.
    - antiverse 4y ago
      There's nothing really inherently racist about it, or bullshit. Mass immigration is a serious subject matter, one that deserves scrutiny and ruthless questioning. Avoiding the questions by calling it racist doesn't make it go away. It's been around for a lot longer than 2010. It has been a popular subject matter in Europe for decades [1]. I guess someone just decided to finally put a more official, catchy title to it and publish books. Does this particular author have a racist tone? Perhaps they do. But ask an average European citizen back in late 80s, 90s and they'd tell you what's up without skipping a beat. It's something you can see from a mile away. Pleading ignorance won't help. [1] Your media won't tell you this, so don't be surprised. Talk to a handful of locals to get a sample for how people really feel about things. It's a much better barometer than getting your news from something like Voice of America.
olegious 4y ago
Less people isn't a bad thing as long as the demographic distribution within the smaller population is healthy- meaning it is shaped like a pyramid, a wide base of young and working age people and smaller numbers of old people non-working people on the top. The problem for many first world countries today is that their populations are shaped like upside down pyramids- many old people and people nearing retirement age and much fewer young and working age people. Why is this a problem? The working age population represents the tax and production base that supports the non-working and non-tax contributing older population, the non-working young people represent the replacement for the working age people that will eventually retire.
- mikkergp 4y ago
  Part of my question would be how to deal with the pyramid. The pyramid should get less pronounced as time goes on as birth rates normalize. Basic human needs industries like clothing, food and shelter should't need that many people to support the retired. Health care may need some intervention. I guess part of the problem is maybe some of this is too much like socialism and/or being able to give non-working persons actual dollars.
  - 2000UltraDeluxe 4y ago
    > Health care may need some intervention. One of the major issues faced by the Nordic countries is that healthcare workers are quitting ing large numbers and starting to take direct action like strikes in order to improve working conditions. In Denmark and Finland there was direct government intervention when nurses went on strike (or threatened in Finland's case); a highly unconventional move considering the fact that both countries grant workers the right to use strikes as a tool in collective bargaining. Both the Danish and the Finnish governments are lead by Social Democrats, the political movement traditionally directly connected with the labour unions. That taken into account, the health care sector doesn't just need some intervention. It requires large-scale restructuring in order to make it a more attractive sector to work in.
- fleddr 4y ago
  The wide base of young people in the healthy pyramid will eventually grow old. Since it was wide, it means to keep the pyramid healthy, multiples of young people would need to be added. Whom will also grow old, needing even more young people.
ozim 4y ago
Problem is that our whole economic system is basically a Ponzi scheme. You get your payoff when you are selling stocks on your retirement to "next fool in chain" so 20-30 year olds. Land, houses will not go up in value if there would be not enough people to buy them. While yes people migrate to the cities or to areas like Randstad and while yes there is housing shortage in such areas but if immigration from rural areas drops a lot there is going to be drop in housing prices. More people have more diverse needs which creates demand - more people more demand - easier to have higher quality of life if it is easier to find 100 customers to come to your shop than 10 customers. People are not starting new grocery shops in rural areas because it is good investment - mostly it is that they already live there and have possibility to make additional income on property they own. People are starting new grocery shops in big cities even if they have to lease property to do so, because they still can profit on top of that.
- ozim 4y ago
  To complete comment I have to add one more thought. Infinite growth is also required for high quality of life unfortunately. Once there is no promise of future earnings by spending now - we start going into zero sum game. Living in a society where every day you have to worry about not loosing piece of pie is really a bad life to live. Less people means lower pressure to find new ways of getting resources - if there is enough people on earth we might have enough money to get resources from astro-mining if needed.
  - vanviegen 4y ago
    I don't buy that line of thinking. People can still (on average) have career growth by taking an ever larger piece of the pie. And then they retire/die, leaving more pie for the young ones. Also, we have the tech to make this pie comfortably big.
  - imtringued 4y ago
    There is this dude that is constantly pulling money out of the economy, leaving less for everyone else. Stop him (the rent seeking) and he won't bother you anymore.
- 4y ago
thefz 4y ago
Because we need to rely on new people financing the economy with money we don't have yet because it is all gone up in smoke.
moonchrome 4y ago
>Why is low fertility rate seen as a bad thing? Because you'll live way past your productive years and the things you will consume (services, goods, medical, etc.) still need to be produced/done by someone. The automation aspect in economy has been way overestimated - truck drivers were supposed to be automated 5 years ago, meanwhile we are facing real world issues because of truck driver shortages. Even jobs that were considered trivial to automate like cashers are still performed by humans - after decades of self checkout tech. Unless your retirement plan is a shotgun barrell - you need the next generation to both live their lives comfortably and provide for you.
- entropi 4y ago
  Ok, but you realize this requires indefinite exponential growth, right?
  - moonchrome 4y ago
    Why ? You're not living forever - and nobody is arguing for high fertility rates. Having 2-3 kids per generation sounds perfectly sustainable. 0 or 1 does not.
    - entropi 4y ago
      So, imagine x couples, each of whom has 3 kids in their lifetimes. In 80 years, there are now 3x/2 couples. In 160, there are 9x/4. There are now 11 billion people. Every 150 or so years, having 3 kids roughly doubles the population. (A better model would be a birth/death process with a #kids distribution with a mean 3 and death age with a mean 80, but not necessary to make my point, I think.) This is exponantial growth.
      - moonchrome 4y ago
        Not everyone survives or has children - which is why I said 2-3 - it has to be above 2 for replacement, it's not a new concept - lookup replacement fertility rate
015a 4y ago
The US, and similarly many other western countries, hasn't been at the replacement fertility rate since ~1970 [1]. Relative to the years previous, its been pretty stable, but still not at the replacement rate: around 1.8, versus 2.1-2.2. That's 50 years; a decent chunk of time. By the way; its important to note that the replacement fertility rate changes over time. Today, in the US, infant mortality rates are half that in 1970 and prior, in basically every category. Ideally, obviously, the replacement rate will approach 2.0. Is there a version of economic thought that doesn't necessitate constant population growth? How about the one we're living? You can make the argument that the world is falling apart, or the economy, or we're at the end of a totally normal 80-100 year economic cycle, or maybe everything is fine, that's all supposition. What's real is; we're still going. The short answer to your question is: historically: No. Empires fall when population growth stalls. When empires fall, a LOT of people die, and a lot more suffer. The dream of "isolated sustainable communes" doesn't work at scale. If your argument is some variation of: the human population shouldn't be at scale; then feel free to remove yourself from the equation as a start down that path, but realistically, we're all here, we have the system we have. However, I tend to believe that the better argument is: we found that version of economic thought which can work in the face of stagnating population growth. Its the one we have; it does work, not perfectly, in fact quite poorly, but we'll never know how bad the alternate realities are. In effect, MMT. Its extremely and critically important to recognize that technology has jumped more in the last thirty years than in the thousands of years prior. Our relationship to it, as individuals and as a society, is still evolving, and that evolution is happening in the face of declining western populations. Technology amplifies individual productivity; so why are we all still working 40 hour weeks? Momentum primarily, but more specifically: our population only recently started plateauing. We needed technology to keep up; its the only way. But as population plateaus, technology will naturally take over more. Its not just "fewer people can do more"; it goes from "fewer people can do more for more people" to "fewer people can do more for fewer people", which naturally means they have to do less. MMT plays into that because: technology is expensive. If we're entering a world where our options are: build a $50B water barrier around Miami or let the city drown, we can't afford to worry about the status of our gold reserves, or whether the blockchain is up today. We wouldn't have the money; we'd chose not to build it; billions of dollars in infrastructure, land, and people would be destroyed; and the economy would be worse off, not better, than if we had just said "blank check do it" and then dealt with the ramifications of that decision tomorrow. That doesn't mean there won't be ramifications. There always are in complex systems. But people get so focused on the reality we're living, to say "if only we'd have stuck to the way we used to do it", without recognizing that its just as possible you, and all your friends, and all your friends' friends, would not be alive if we had stuck to that old system. Here's the biggest kink though; generally, well-implemented MMT (which much like well-implemented communism, hasn't been done, but has been written about to great lengths) requires close coordination between monetary and legislative policy; something our government is engineered to not do. We're seeing the impacts of this miscoordination now; there's a strong argument that the biggest source of inflation today has less to with money printing or interest rates, and more to do with core productivity in the sectors experiencing that inflation (energy: oil processing, housing: home building, public transit construction, etc). Core productivity (more factories, more construction, automation, etc) can oftentimes be solved with cheap, targeted money; but the Fed is currently engaged in a show of raising interest rates. Its the one lever they have; every problem is a screw, they have their directive: a hammer. I don't feel this is doom and gloom, today; a lot of the issues we're experiencing are, truly, just the delayed echoes of COVID which will die out, raising interest rates will legitimately help some sources of inflation, and the legislature has demonstrated interest in providing cheap money for productivity improvements (build back better). But, its still how the Fed operates; they have their doctrine and their lever, and its easy to imagine a future where more coordination is necessary to push through massive spending in response to major issues like the climate crisis, declining water supplies, etc, without either succumbing to the crisis, or creating a new economic crisis. [1] https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/
dash2 4y ago
There are certainly theories where falling population is not a problem. (There's a theory for everything.) The question is whether those theories are right. One issue for economic growth is that many modern theories claim that growth is driven by ideas and innovations. Fewer people might lead to fewer ideas and innovations. If so, then we will be poorer as a result. Here's a 2010 review suggesting population decline is no biggie: https://academic.oup.com/oxrep/article-abstract/26/4/583/453716 https://academic.oup.com/oxrep/article-abstract/26/4/583/453... Here's a recent paper on the topic: https://www.bde.es/f/webbde/INF/MenuHorizontal/SobreElBanco/Conferencias/2015/Archivos/26_1220B_BASSO_PAPER.pdf https://www.bde.es/f/webbde/INF/MenuHorizontal/SobreElBanco/... Update: here's a paper by Charles Jones. This might be better because (1) Charles Jones is rather famous growth economist and (2) it focuses specifically on population decline rather than population ageing. https://www.nber.org/papers/w26651 https://www.nber.org/papers/w26651
wolpoli 4y ago
If you look at falling fertility rate within the demographic transition model, an economy will first enjoy a time where the number of dependent to the working age population will decrease (demographic transition), meaning that people will enjoy higher standard of living, economy will have excess capital for growth, and everyone is happy. Decades later, the number of dependent to the working age population will increase again (demographic aging), in which the unfortunate reverse will occur, and people will start sounding the alarm, and it's 2 decades too late to anything about it. The vintage-futurism economic dream of 10 hour workweeks will be tough to achieve if we need many in the working age population taking care of the elderly.
imtringued 4y ago
It is called Freiwirtschaft. They mayor Unterguggenberger implemented a demurrage currency during the great depression in Wörgl and it solved the unemployment and budget deficit problem without inflation.

xnx 4y ago

I'd love an economic system that championed efficiency over growth.

bombcar 4y ago
I've seen arguments that almost all of the economic growth over the last 100+ years is directly attributable to population growth and very little else.
- gruez 4y ago
  Source? That would imply total factor productivity didn't grow at all "over the last 100+ years", which seems doubtful given all the innovations brought about during that time period.
  - mellavora 4y ago
    I don't have a source, nor do I fully believe the original poster, but do consider: 7x population growth, shift from 80% rural to 90% urban. Where "rural" is low economic engagement and "urban" is a job-holder. shift from single-earning families to dual-earner, where again a stay-at-home mom does not increase the size of the economy while a working one does (and please, I know this is unfair and the tremendous value a full time Mom provides). Multiple these three shifts and you get a pretty big increase in the economy, with zero increase in productivity.
    - bombcar 4y ago
      That's the basic argument, which I don't have at hand, but there have been some very specific "improvement in output" moments in history but those are in the long past and most of what we have now over time is basically the same as growth of population in the US.
imtringued 4y ago
Freiwirtschaft...

missedthecue 4y ago

Capitalism doesn't require for constant population growth. But public pension schemes do. And there are geopolitical advantages to being bigger than your foes. Look at Japan. Japan's population has been on the decline for about 1.5 generations. They still get as much food, shelter, and entertainment as any other developed economy. They have hobbies, travel, discretionary income... The worries there aren't about capitalism failing. Demographic collapse just has a lot of nasty social consequences in general. An inverted pyramid spells pain for future generations.

cs137 4y ago
Public pensions are pretty much gone these days, for better or worse. I don't think an inverted pyramid is as bad as it sounds. It's a check against ageism and falling wages (there's no longer a horde of hungry young people who want the jobs) and, given how little of the work people do is actually necessary--white-collar jobs are 85% sending passive-aggressive emails--I think society can afford it. It might be the only thing that provides enough value of labor to keep conditions relatively humane.
- missedthecue 4y ago
  By public pension, I mean what we in the US call Social Security. Most developed economies have an equivalent.
- lotsofpulp 4y ago
  > Public pensions are pretty much gone these days, for better or worse. Taxpayer funded (which is what “public” generally means) pensions are basically the only defined benefit pensions left in the US. I do not know of a single city, county, state, or federal government that has gotten rid of them, especially not for cops.
  - dragonwriter 4y ago
    “public pensions” usually refers to schemes like social security in the US. “public employee pensions” are a different thing. (But neither is gone, in general or in the US, though more and more government employee positions in the US are relying more on defined contribution retirement plans and less on defined benefit pensions.)

dfxm12 4y ago

Why is low fertility rate seen as a bad thing? It's mostly seen as a bad thing in the lens of ethnic nationalist ideology that low fertility rates will change the demographics of a country (see Great Replacement [0]). After all, if Musk (and other capitalists) needed, they can get labor from other countries south of America's borders, but there is a push to not make these workers Americans! This isn't an issue only in America either. 0 - https://en.wikipedia.org/wiki/Great_Replacement https://en.wikipedia.org/wiki/Great_Replacement

bombcar 4y ago
Importing workers fails for the world as a whole, and the number of countries that easy importation works for is also declining.
antiverse 4y ago
>https://en.wikipedia.org/wiki/Great_Replacement https://en.wikipedia.org/wiki/Great_Replacement >[...] is a white nationalist far-right conspiracy theory [...] Native Americans would disagree.
- cgrealy 4y ago
  The "Great Replacement" theory originated in the 2010s and is specifically about white people being replaced (in case anyone was in any doubt, it's racist bullshit). It's a (bullshit paranoid) predictive theory about the modern day that has nothing to do with the historical genocide of Native Americans by white people.
  - antiverse 4y ago
    There's nothing really inherently racist about it, or bullshit. Mass immigration is a serious subject matter, one that deserves scrutiny and ruthless questioning. Avoiding the questions by calling it racist doesn't make it go away. It's been around for a lot longer than 2010. It has been a popular subject matter in Europe for decades [1]. I guess someone just decided to finally put a more official, catchy title to it and publish books. Does this particular author have a racist tone? Perhaps they do. But ask an average European citizen back in late 80s, 90s and they'd tell you what's up without skipping a beat. It's something you can see from a mile away. Pleading ignorance won't help. [1] Your media won't tell you this, so don't be surprised. Talk to a handful of locals to get a sample for how people really feel about things. It's a much better barometer than getting your news from something like Voice of America.

olegious 4y ago

Less people isn't a bad thing as long as the demographic distribution within the smaller population is healthy- meaning it is shaped like a pyramid, a wide base of young and working age people and smaller numbers of old people non-working people on the top. The problem for many first world countries today is that their populations are shaped like upside down pyramids- many old people and people nearing retirement age and much fewer young and working age people. Why is this a problem? The working age population represents the tax and production base that supports the non-working and non-tax contributing older population, the non-working young people represent the replacement for the working age people that will eventually retire.

mikkergp 4y ago
Part of my question would be how to deal with the pyramid. The pyramid should get less pronounced as time goes on as birth rates normalize. Basic human needs industries like clothing, food and shelter should't need that many people to support the retired. Health care may need some intervention. I guess part of the problem is maybe some of this is too much like socialism and/or being able to give non-working persons actual dollars.
- 2000UltraDeluxe 4y ago
  > Health care may need some intervention. One of the major issues faced by the Nordic countries is that healthcare workers are quitting ing large numbers and starting to take direct action like strikes in order to improve working conditions. In Denmark and Finland there was direct government intervention when nurses went on strike (or threatened in Finland's case); a highly unconventional move considering the fact that both countries grant workers the right to use strikes as a tool in collective bargaining. Both the Danish and the Finnish governments are lead by Social Democrats, the political movement traditionally directly connected with the labour unions. That taken into account, the health care sector doesn't just need some intervention. It requires large-scale restructuring in order to make it a more attractive sector to work in.
fleddr 4y ago
The wide base of young people in the healthy pyramid will eventually grow old. Since it was wide, it means to keep the pyramid healthy, multiples of young people would need to be added. Whom will also grow old, needing even more young people.

ozim 4y ago

Problem is that our whole economic system is basically a Ponzi scheme. You get your payoff when you are selling stocks on your retirement to "next fool in chain" so 20-30 year olds. Land, houses will not go up in value if there would be not enough people to buy them. While yes people migrate to the cities or to areas like Randstad and while yes there is housing shortage in such areas but if immigration from rural areas drops a lot there is going to be drop in housing prices. More people have more diverse needs which creates demand - more people more demand - easier to have higher quality of life if it is easier to find 100 customers to come to your shop than 10 customers. People are not starting new grocery shops in rural areas because it is good investment - mostly it is that they already live there and have possibility to make additional income on property they own. People are starting new grocery shops in big cities even if they have to lease property to do so, because they still can profit on top of that.

ozim 4y ago
To complete comment I have to add one more thought. Infinite growth is also required for high quality of life unfortunately. Once there is no promise of future earnings by spending now - we start going into zero sum game. Living in a society where every day you have to worry about not loosing piece of pie is really a bad life to live. Less people means lower pressure to find new ways of getting resources - if there is enough people on earth we might have enough money to get resources from astro-mining if needed.
- vanviegen 4y ago
  I don't buy that line of thinking. People can still (on average) have career growth by taking an ever larger piece of the pie. And then they retire/die, leaving more pie for the young ones. Also, we have the tech to make this pie comfortably big.
- imtringued 4y ago
  There is this dude that is constantly pulling money out of the economy, leaving less for everyone else. Stop him (the rent seeking) and he won't bother you anymore.
4y ago

thefz 4y ago

Because we need to rely on new people financing the economy with money we don't have yet because it is all gone up in smoke.

moonchrome 4y ago

>Why is low fertility rate seen as a bad thing? Because you'll live way past your productive years and the things you will consume (services, goods, medical, etc.) still need to be produced/done by someone. The automation aspect in economy has been way overestimated - truck drivers were supposed to be automated 5 years ago, meanwhile we are facing real world issues because of truck driver shortages. Even jobs that were considered trivial to automate like cashers are still performed by humans - after decades of self checkout tech. Unless your retirement plan is a shotgun barrell - you need the next generation to both live their lives comfortably and provide for you.

entropi 4y ago
Ok, but you realize this requires indefinite exponential growth, right?
- moonchrome 4y ago
  Why ? You're not living forever - and nobody is arguing for high fertility rates. Having 2-3 kids per generation sounds perfectly sustainable. 0 or 1 does not.
  - entropi 4y ago
    So, imagine x couples, each of whom has 3 kids in their lifetimes. In 80 years, there are now 3x/2 couples. In 160, there are 9x/4. There are now 11 billion people. Every 150 or so years, having 3 kids roughly doubles the population. (A better model would be a birth/death process with a #kids distribution with a mean 3 and death age with a mean 80, but not necessary to make my point, I think.) This is exponantial growth.
    - moonchrome 4y ago
      Not everyone survives or has children - which is why I said 2-3 - it has to be above 2 for replacement, it's not a new concept - lookup replacement fertility rate

015a 4y ago

The US, and similarly many other western countries, hasn't been at the replacement fertility rate since ~1970 [1]. Relative to the years previous, its been pretty stable, but still not at the replacement rate: around 1.8, versus 2.1-2.2. That's 50 years; a decent chunk of time. By the way; its important to note that the replacement fertility rate changes over time. Today, in the US, infant mortality rates are half that in 1970 and prior, in basically every category. Ideally, obviously, the replacement rate will approach 2.0. Is there a version of economic thought that doesn't necessitate constant population growth? How about the one we're living? You can make the argument that the world is falling apart, or the economy, or we're at the end of a totally normal 80-100 year economic cycle, or maybe everything is fine, that's all supposition. What's real is; we're still going. The short answer to your question is: historically: No. Empires fall when population growth stalls. When empires fall, a LOT of people die, and a lot more suffer. The dream of "isolated sustainable communes" doesn't work at scale. If your argument is some variation of: the human population shouldn't be at scale; then feel free to remove yourself from the equation as a start down that path, but realistically, we're all here, we have the system we have. However, I tend to believe that the better argument is: we found that version of economic thought which can work in the face of stagnating population growth. Its the one we have; it does work, not perfectly, in fact quite poorly, but we'll never know how bad the alternate realities are. In effect, MMT. Its extremely and critically important to recognize that technology has jumped more in the last thirty years than in the thousands of years prior. Our relationship to it, as individuals and as a society, is still evolving, and that evolution is happening in the face of declining western populations. Technology amplifies individual productivity; so why are we all still working 40 hour weeks? Momentum primarily, but more specifically: our population only recently started plateauing. We needed technology to keep up; its the only way. But as population plateaus, technology will naturally take over more. Its not just "fewer people can do more"; it goes from "fewer people can do more for more people" to "fewer people can do more for fewer people", which naturally means they have to do less. MMT plays into that because: technology is expensive. If we're entering a world where our options are: build a $50B water barrier around Miami or let the city drown, we can't afford to worry about the status of our gold reserves, or whether the blockchain is up today. We wouldn't have the money; we'd chose not to build it; billions of dollars in infrastructure, land, and people would be destroyed; and the economy would be worse off, not better, than if we had just said "blank check do it" and then dealt with the ramifications of that decision tomorrow. That doesn't mean there won't be ramifications. There always are in complex systems. But people get so focused on the reality we're living, to say "if only we'd have stuck to the way we used to do it", without recognizing that its just as possible you, and all your friends, and all your friends' friends, would not be alive if we had stuck to that old system. Here's the biggest kink though; generally, well-implemented MMT (which much like well-implemented communism, hasn't been done, but has been written about to great lengths) requires close coordination between monetary and legislative policy; something our government is engineered to not do. We're seeing the impacts of this miscoordination now; there's a strong argument that the biggest source of inflation today has less to with money printing or interest rates, and more to do with core productivity in the sectors experiencing that inflation (energy: oil processing, housing: home building, public transit construction, etc). Core productivity (more factories, more construction, automation, etc) can oftentimes be solved with cheap, targeted money; but the Fed is currently engaged in a show of raising interest rates. Its the one lever they have; every problem is a screw, they have their directive: a hammer. I don't feel this is doom and gloom, today; a lot of the issues we're experiencing are, truly, just the delayed echoes of COVID which will die out, raising interest rates will legitimately help some sources of inflation, and the legislature has demonstrated interest in providing cheap money for productivity improvements (build back better). But, its still how the Fed operates; they have their doctrine and their lever, and its easy to imagine a future where more coordination is necessary to push through massive spending in response to major issues like the climate crisis, declining water supplies, etc, without either succumbing to the crisis, or creating a new economic crisis. [1] https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/

dash2 4y ago

There are certainly theories where falling population is not a problem. (There's a theory for everything.) The question is whether those theories are right. One issue for economic growth is that many modern theories claim that growth is driven by ideas and innovations. Fewer people might lead to fewer ideas and innovations. If so, then we will be poorer as a result. Here's a 2010 review suggesting population decline is no biggie: https://academic.oup.com/oxrep/article-abstract/26/4/583/453716 https://academic.oup.com/oxrep/article-abstract/26/4/583/453... Here's a recent paper on the topic: https://www.bde.es/f/webbde/INF/MenuHorizontal/SobreElBanco/Conferencias/2015/Archivos/26_1220B_BASSO_PAPER.pdf https://www.bde.es/f/webbde/INF/MenuHorizontal/SobreElBanco/... Update: here's a paper by Charles Jones. This might be better because (1) Charles Jones is rather famous growth economist and (2) it focuses specifically on population decline rather than population ageing. https://www.nber.org/papers/w26651 https://www.nber.org/papers/w26651

wolpoli 4y ago

If you look at falling fertility rate within the demographic transition model, an economy will first enjoy a time where the number of dependent to the working age population will decrease (demographic transition), meaning that people will enjoy higher standard of living, economy will have excess capital for growth, and everyone is happy. Decades later, the number of dependent to the working age population will increase again (demographic aging), in which the unfortunate reverse will occur, and people will start sounding the alarm, and it's 2 decades too late to anything about it. The vintage-futurism economic dream of 10 hour workweeks will be tough to achieve if we need many in the working age population taking care of the elderly.

imtringued 4y ago

It is called Freiwirtschaft. They mayor Unterguggenberger implemented a demurrage currency during the great depression in Wörgl and it solved the unemployment and budget deficit problem without inflation.