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Can a negative population growth rate sustain a positive economic growth rate in the long run?

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  • Bucci, Alberto

Abstract

To better understand the long-term consequences and the possible channels (mainly, technological progress and human capital accumulation) through which a declining population may eventually sustain long-run economic growth and innovation in advanced economies, we build an endogenous, non-scale growth model with horizontal R&D activity and human capital investment. Population growth and per capita human capital accumulation are linked to each other by means of what in the paper is identified as the ‘multiplicative effect’ of population. As long as the strength of this effect exceeds a given positive threshold, population growth and per-capita income growth can be negatively correlated. This means that a negative rate of population growth can sustain a positive economic growth rate in the long run.

Suggested Citation

  • Bucci, Alberto, 2023. "Can a negative population growth rate sustain a positive economic growth rate in the long run?," Mathematical Social Sciences, Elsevier, vol. 122(C), pages 17-28.
    • Handle: RePEc:eee:matsoc:v:122:y:2023:i:c:p:17-28
    DOI: 10.1016/j.mathsocsci.2023.01.001
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