Chapter 2: The Logic of the Malthusian Economy "....and the life of man, solitary, poor, nasty, brutish and short." Hobbes, Leviathan (1651). Introduction The Malthusian model of the pre-industrial economy starts from the insight that the biological capacity of women to produce offspring is much greater than the number of births required to reproduce the population. If fertility is unrestricted it is possible for women sexually active throughout their reproductive lives to have twelve or more children.1 Social institutions regulating the age of marriage, the percentage of women marrying, extramarital fertility, and contraceptive practices will determine the actual numbers of children per women. In modern societies these institutions and practices vary greatly so we observe great variation in the number of births per women. Thus as table 1 shows the number of births per women ranged in different countries in 1997 from a low of 1.19 in Italy to a high of 7.6 in Yemen. This means that currently in Italy each women of the current generation is being replaced by at maximum 0.6 women of the next generation (assuming all girls survive to adulthood). In Yemen in contrast if all daughters were to survive to adulthood there would be 3.8 women in the next generation for every woman now. Only where women happen on average to have two children who survive to adulthood will population be stable in the long run. Even small deviations from this number will cause rapid increases or decreases in population. Thus table 1 also shows the population projected from for fifty years from now, 2051, if all children 1We know this from observations of the fertility levels of Hutterites in the 1920s to 1950s. The Hutterites were an Anabaptist sect settled in the upper Great Plains of the USA modern religious groups who married early and did not practice birth control. Hutterite women married from 15 to 50 had 12.5 children on average. Both my grandmothers, who were Irish Catholics who married at the unusually early age for this community of 16, had large families: one 12 and the other 13 children. 1 survive to adulthood. As can be seen if all these children survive 2 Table 1: Modern Fertility Rates and their Implications for Population Country Births Populati Income per Projected per on Person, Populatio Woman 1997 1992 n (m.) ($ 1985) 2051 Italy 1.19 57.2 12,721 20.3 Spain 1.22 39.7 9,802 14.8 Germany 1.30 82.2 14,709 34.7 Japan 1.48 125.6 15,105 68.8 France 1.63 58.5 13,918 38.9 Canada 1.61 29.9 16,362 19.4 United 1.72 58.2 12,724 43.0 Kingdom USA 1.96 271.6 17,945 260.8 Brazil 2.17 163.1 3,882 192.0 Bangladesh 3.14 122.0 1,510 300.7 Egypt 3.40 64.5 1,869 186.4 Saudi Arabia 5.90 19.5 *6,885 169.7 Ethiopia 7.00 60.1 **316 736.2 Uganda 7.10 20.8 547 262.1 Niger 7.10 9.8 *505 123.5 Yemen 7.60 16.3 *1,979 235.4 Note: The first column show the “Total Fertility Rate.” This is the number of births a woman who reaches age 50 has on average. The last column shows the projected population assuming no mortality before the end of reproductive age, and a generation of length 25 years. * = 1989. ** = 1986. Source: United Nations, Population and Vital Statistics Report (1998). Penn World Tables. 3 countries are on a knife edge between explosive population growth and catastrophic population decline. In fifty years there would be only 20 million Italians compared to 57 million now, but 170 million Saudi Arabians compared to 20 million now. Despite this potential for explosive growth pre-industrial populations are remarkably stable in the long run. To a first approximation in all pre-industrial societies the population growth rate in the long run was close to zero. Thus the population of Egypt, for example, is estimated at between four and five million circa 1,000 BC. The population in in Greek and Roman Egypt 1,000 years later is estimated at this same four to five million. The first modern census in 1848 suggests a population of about 4.5 million. Thus over a period of 2,850 years the growth rate of population despite some swings up and down was to a very close approximation zero, and women on average had two surviving children.2 Yet a Bagnall and Frier estimate that in Roman Egypt in the first three centuries AD shows that the average women give birth to six children. The long run stability of population sizes was also found in pre-industrial Europe. From 1340 to 1680 the population of the major European countries actually fell slightly, as Table 2 shows, though there had been significant growth in the years 1100 to 1340. Assuming a generation length of 25 years the average number of surviving children per woman from 1340 to 1680 was: England, 1.97, France , 1.99, Italy, 1.97, Germany, 1.95, Spain, 1.93, Netherlands, 1.90. All these countries were close to the stable population level of two surviving children per woman. The most extreme difference was between France with 1.99 children per woman compared to the Netherlands with 1.90 children per woman. Given the variations in fertility in the modern world, why did these societies end up looking so similar in terms of the numbers of children surviving to adulthood? 2McEvedy and Jones (1978), pp. 228-9, Bagnall and Frier (1994), pp. 54-56. 4 Table 2: Populations in Western Europe, 1340-1680 Year 1340 1550 1680 England 6 3 4.9 France 24 1721.9 Italy 15 1112.0 Germany 17 1212.0 Spain 14 98.5 Netherlands 4 1.2 1.9 Western 80 61 72 Europe Sources: Hatcher, Plague, Population and the English Economy, 1348-1530 (1977), p. 71. E. A. Wrigley and R. Schofield, Population History of England and Wales, p. 232-3. E. A. Wrigley, "The Growth of Population in Eighteenth Century England: a Conundrum Resolved," Past and Present, 98 (1983). 5 The Simple Malthusian Model The crucial insight of the Malthusian model is that the population stability of pre-industrial economies implies a mechanism in these societies which ensures that on average births equal deaths. In its simplest version there are just three assumptions: 1. The BIRTH RATE is a constant, independent of the real wage. 2. The DEATH RATE declines as real wages increase. 3. The REAL WAGE declines as population increases. The birth rate is normally quoted by demographers as the number of births per year per thousand people in a population. At maximum observed fertility levels this would be about 50 or 60. In modern western Europe where each women has less than two children birth rates are in now the order of 9-14 per thousand. In Italy, one of the countries with the lowest birth rate in the world, there are now only 9.3 births per thousand people per year. In very poor countries birth rates are in the order of 40-50 births per thousand. Thus in the area of highest birth rates which is Central Africa some countries have birth rates which exceed 50 per thousand: Niger 52.5, Somalia 50.2, Uganda 51.8. The death rate is again typically quoted by demographers as the number of deaths per thousand of population. In a stable population the death rate is the inverse of life expectancy at birth.3 Thus if life expectancy is 75 years the death rate will be 13.3 per thousand. If life expectancy is 30 years the death rate will be 33.3 per thousand. Because of growing populations, which have fewer old people, many countries in the modern world have death rates below 10 per thousand, as Table 3 demonstates. The growth rate of population is simply the birth rate minus the death rate. Thus in a stable population the birth rate equals the death rate by definition, so life expectancy can be equivalently calculated as the inverse of the birth rate. In a stable population a birthrate of 50 per thousand of population implies a life expectancy of 20 at birth. In the modern world populations in general are not 3 If D is the death rate then D = 1/e0. 6 stable but changing rapidly. Table 3 shows for a range of countries birth rates, death rates and the consequent rates of population growth from natural increase, and also the rates including migration. As can be seen Oman in 1997 had a growth rate of population from natural increase and migration of 4.16 percent, so that the current population of 2.4 million is projected to grow to 19 million by 2047, eight times the current population. For Saudi Arabia the projected population is 108 million, nearly siz times the current population. Table 3: Birth Rates, Death Rates, and Population Growth Rates in the Modern World Country Birth Death Rate Natural Growth Rate Growth Rate (/1000), Rate (/1000), 1994 (%), 1994 (%), 1994 1997 Italy 9.3 9.5 -0.02 0.00 Japan 10.1 7.0 0.31 0.22 Germany 9.4 10.8 -0.14 0.27 USA 15.6 8.8 0.68 0.79 Mexico 27.7 5.3 2.24 1.63 Bangladesh 35.5 11.7 2.38 1.64 Egypt 29.7 7.2 2.25 1.85 Uganda 51.8 19.2 3.26 2.63 Niger 52.5 18.9 3.36 3.32 Saudi 35.1 4.7 3.04 3.42 Arabia Yemen 3.74 Oman 4.16 Source: 7 The real wage is the unskilled wage in any society measured in terms of constant purchasing power.