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I personally don't think it's such a bad thing if our population stays stable rather than increasing, even small decline I don't think is such a bad thing.

atoav 3y ago
In an economy based on growth that means however, investors still expect more money each year. And that money has to come from somewhere. So either your population grows, so the more work is distributed better on more shoulders or you try to educate them better to increase the quality of the corporations etc. But the fact that our economies expect constant growth has consequences for everything else
midasuni 3y ago
With boomers retiring the numver of non working people with a lot of income increasing relative to the number of people who do work. This is ripe for long term inflation - especially in areas old people spend in, and that’s before the added tax drain of social security.
somenameforme 3y ago
It's not going to be a small decline. Here [1] is a population projection for Japan based on UN numbers. And those numbers are unreasonably optimistic, because they make the assumption that life expectancy in the future will continue to increase at the rate it has in the past, and that Japan's fertility rate will substantially increase in the future. Neither assumption seems justified. The important issue is that fertility is an exponential function. When one group has a low fertility rate they have fewer children, and those children have fewer children so onward. And so the rate of decline never changes unless the fertility rate does. But these numbers are also staggered out by the life expectancy of the first generation to have lower fertility. So when going from high to low fertility society you will see a period of increase, stabilization, and then exponential decline. With Japan we're just about to head into the exponential decline phase. I expect the reason the UN expects a fertility rate change is that if you don't increase it, you go extinct. So it'll probably become the next big issue relatively soon - across the entire developed world. --------- Also in terms of things like an 'aging population.' This does not change when the older group dies off. In fact if the aging population had a higher fertility rate than their children, then it will only become worse. It's the exact same issue in play. When you have lots of children, you end up with a high youth to elderly population. When you don't have many children, you end up with a high elderly to youth population. And that poses immense practical, social, and economic problems. [1] - https://population.un.org/wpp/Graphs/Probabilistic/POP/TOT/392 https://population.un.org/wpp/Graphs/Probabilistic/POP/TOT/3...
lumb63 3y ago
The big issue IMO with a declining population is a lot of our economic structure here in America is built on the assumption growth is infinite. Social security would be insolvent if not enough people paid in to fund those being paid out. Stock prices and home prices would decrease as well. Debt would become more expensive since there would be fewer people to pay it back. Because assets are priced based on their future value, growth is a huge component of the prices assets. The value of most everything in our society is predicated on that rate of growth.
- floatrock 3y ago
  Well when you put it that way, it kinda sounds like you're describing a ponzi scheme. What happens when this infinite growth starts to run up against finite planetary boundaries?
  - imtringued 3y ago
    You start a world war to reset the board game.
- imtringued 3y ago
  Also most economists make assumptions of endless economic growth. Especially the Austrian Economists with their pure time preference theory implicitly assume endless growth as pure time preference makes no sense in an economy that is stagnating or shrinking. Why would patience be rewarded in the future if the future will be worse? A lot of the foundations of economics fall apart once you assume logistic growth.

atoav 3y ago

In an economy based on growth that means however, investors still expect more money each year. And that money has to come from somewhere. So either your population grows, so the more work is distributed better on more shoulders or you try to educate them better to increase the quality of the corporations etc. But the fact that our economies expect constant growth has consequences for everything else

midasuni 3y ago

With boomers retiring the numver of non working people with a lot of income increasing relative to the number of people who do work. This is ripe for long term inflation - especially in areas old people spend in, and that’s before the added tax drain of social security.

somenameforme 3y ago

It's not going to be a small decline. Here [1] is a population projection for Japan based on UN numbers. And those numbers are unreasonably optimistic, because they make the assumption that life expectancy in the future will continue to increase at the rate it has in the past, and that Japan's fertility rate will substantially increase in the future. Neither assumption seems justified. The important issue is that fertility is an exponential function. When one group has a low fertility rate they have fewer children, and those children have fewer children so onward. And so the rate of decline never changes unless the fertility rate does. But these numbers are also staggered out by the life expectancy of the first generation to have lower fertility. So when going from high to low fertility society you will see a period of increase, stabilization, and then exponential decline. With Japan we're just about to head into the exponential decline phase. I expect the reason the UN expects a fertility rate change is that if you don't increase it, you go extinct. So it'll probably become the next big issue relatively soon - across the entire developed world. --------- Also in terms of things like an 'aging population.' This does not change when the older group dies off. In fact if the aging population had a higher fertility rate than their children, then it will only become worse. It's the exact same issue in play. When you have lots of children, you end up with a high youth to elderly population. When you don't have many children, you end up with a high elderly to youth population. And that poses immense practical, social, and economic problems. [1] - https://population.un.org/wpp/Graphs/Probabilistic/POP/TOT/392 https://population.un.org/wpp/Graphs/Probabilistic/POP/TOT/3...

lumb63 3y ago

The big issue IMO with a declining population is a lot of our economic structure here in America is built on the assumption growth is infinite. Social security would be insolvent if not enough people paid in to fund those being paid out. Stock prices and home prices would decrease as well. Debt would become more expensive since there would be fewer people to pay it back. Because assets are priced based on their future value, growth is a huge component of the prices assets. The value of most everything in our society is predicated on that rate of growth.

floatrock 3y ago
Well when you put it that way, it kinda sounds like you're describing a ponzi scheme. What happens when this infinite growth starts to run up against finite planetary boundaries?
- imtringued 3y ago
  You start a world war to reset the board game.
imtringued 3y ago
Also most economists make assumptions of endless economic growth. Especially the Austrian Economists with their pure time preference theory implicitly assume endless growth as pure time preference makes no sense in an economy that is stagnating or shrinking. Why would patience be rewarded in the future if the future will be worse? A lot of the foundations of economics fall apart once you assume logistic growth.