Individualism and demographic change

This paper aims to provide a counterweight to the omnipresent gloomy analyses of demographic change in Western societies. The central argument is that the strains and challenges which demographic change poses for different sub-orders of society can lead to a higher appreciation of the individual in these sub-orders, possibly entailing self-correcting properties of the process of demographic change. First, a two-fold division is provided for the causes of demographic change, distinguishing between "materialistic" and "idealistic" causes. While today's public debate often concentrates on materialistic causes, entailing materialistic-focused policies, the paper presents a set of idealistic causes and discusses their relevance. Second, a number of possible effects are studied as to how the changes induced by demographic change in selected sub-orders of society - labor market, education system and political system - can qualitatively change these sub-orders. These thought experiments show that, under realistic assumptions, demographic change can lead to a higher appreciation of the individual as employee, entrepreneur, student and citizen. The policy implications are twofold. First, the analysis shows that an individualist perspective of economy and society generates much less gloomy and less deterministic scenarios than the ones on which "over-activist" policies in Germany and elsewhere are often based. Second, if the "idealistic" focus of the paper is at least partially warranted, the legitimacy of paternalist government interventions into the highly personal decisions regarding fertility appears even more questionable.