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Population Pressure and Implications for the Economy: A World’s Analysis of the Recent Past

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  • Enriqueta Camps

Abstract

In this paper we present further quantitative evidence for the impact of population growth on the world economy (prices, per capita GDP) during the second demographic transition. We use population growth as a proxy for the evolution of aggregate demand at the world level as well as the United Nations population-growth projections to the end of the twenty-first century. Since population can be considered as an endogenous variable of the economy, an Instrumental Variable analysis has been developed in order to obtain different and more reliable results on the causality effect of population growth on the world economy. We compare worldwide results with the Instrumental Variables results of the continents that currently represent the greater population pressure on supply: Sub-Saharan Africa and Asia. From this analysis we conclude that inflation rates are mostly explained by the purchasing power of populations – that is, the aggregate demand – rather than by population pressure.

Suggested Citation

  • Enriqueta Camps, 2022. "Population Pressure and Implications for the Economy: A World’s Analysis of the Recent Past," Working Papers 1354, Barcelona School of Economics.
    • Handle: RePEc:bge:wpaper:1354
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    More about this item

    Keywords

    world population growth; sustainability; output; inflation;
    All these keywords.

    JEL classification:

    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists
    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy

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