It's not a disaster, but it is a persistent drag.
Getting people to have more kids in a modern industrial/service economy means persuading them to have kids.
There seem to be two relatively effective approaches to this: one is patriarchy, ie pushing women out of the workforce to have and raise children, structuring the economy so that a single income is sufficient to support a household, making dual-income households rare, keeping (male) unemployment low, etc. This worked well in the US in the 1950s, leading to the Baby Boom. There were similar booms during les trente glorieuses and the Wirtschaftswunder (ie the 1950s and 1960s) in France and Germany.
I don't think this approach is socially acceptable now; any politician who proposed it would be driven out of office. It's worth noting that right-wing religious political parties have lots of senior women in them now - the Dutch SGP abandoned its long-standing opposition to women's suffrage in 2017, and started running women as candidates for political office the following year. Less explicitly religious parties of the right, like the French RN or the German AfD have plenty of senior women (the RN, of course, is led by Marine Le Pen). Similarly, leading figures of the right-wing within the US Republican Party (there isn't a formal leadership of the faction) are often women, like Marjorie Taylor Greene or Lauren Boebert - or Sarah Palin a generation ago.
The alternative approach is to ensure that working women are able to raise children, what we might call the "Nordic" approach. TFR in the Nordic countries is not above replacement, but it is notably higher than in most of the rest of Europe. Paid leave for parents (critically, both parents: if fathers don't take parental leave, then you create a huge incentive for employers to discriminate, which then incentivises women not to have children in order to avoid the discrimination) and high-quality childcare at affordable prices both go towards building a culture that is accepting of working women having children - which is essential if TFR is going to get back up towards replacement. France is another country with a robust TFR.
What does seem to be disastrous is for women to work but work not to be reshaped so that it is compatible with parenthood. The catastrophic TFRs of countries like Italy and Spain (so bad that even Japan looks good by comparison) seem to come from this place.
I was always confused by Peter Zeihan's persistent comments on the coming doom for Europe and China as their demographic is aging. richer countries can go long way to subsidize healthcare, eldercare, and childcare reducing dependency on working age population.
but two problems: I think it will be a big problem for countries that have low GDP and were not able to gain from demographic dividend. also, why haven't european countries and japan increased incentives to have kids? It is expensive but they can foot the bill (I want a 500 million Japan).
also I dont know the state of pro-natal propaganda in these countries since I live in India and people here are still afraid of overpopulation but I would guess it could be increased.
also, I think US could still attract many talented young people from other countries for education, even 50 years in the future (if AI doesn't replace us all). Indian state of kerela has had a below replacement fertility rate for decades and still a large population migrates out. why do you think would immigration fall?
What is the actual point of these projections to 2100? No way that birth rates remain static in all these countries till then. Whether we actively change policies or not.
Over next 20-30 years immigration can change the picture, over 30-50 years policies that impact birth rate can make a difference. 50+ years is far to dependent on changes between now and then for any real prediction or need to take it into account in policy planning.
It feels like panic at low birth rates is the Malthusian fallacy of ours, the reverse Malthus I guess.
Time to tell grandpa to start a substack!
What do you think of the idea that, in an aging population, the growing burden of working age people looking after the elderly is balanced out by less child care duties? Kids can be pretty high maintenance too, so maybe it's kind of a dead heat?
We need to think outside the box; old recipes are not suitable for new problems. Politicians need to devise new strategist, however bold they may seem. I think we need to start collaborating more and competing less if we are to survive an anforeseen array of issues of fenomenal dimension. The common denominator is the climate change wich is altering so many factors that no one is now capable of guessing the consequences.
The dependency ratio (share of population aged 15-64) is a nonsense. Young people are still mostly dependent into their early 20s nowadays, consuming expensive educational resources as well as parental support. As far as fiscal policy is concerned, old people are more noticeable because they are more likely to be supported by the state.
But the reality is that both the age of entering the workforce and the age of leaving it are rising about as fast as life expectancy.
Very good essay -- I've been writing about the same topic of late. One glitch: your link to Maestas, Mullen, & Powell goes to a different publication instead.
When I was younger, Real Estate ownership made sense. The rate of appreciation was slightly more than the rate of inflation and a large percentage of the cost could be financed by debt that was somewhat less than the rate of appreciation. The past 15 years have been a less stable version of the same story.
Appreciation was closely related to population, construction, and obsolescence, with the latter being more a function of where people wanted to live than the actual function of a building that could be refurbished.
This story changes dramatically in a country where population decreases. Obsolescence becomes common: Turning ownership in less desired locations into a game of musical chairs. Real prices are likely decline or become flat: eliminating a key component of middle-class wealth accumulation. This, in turn should impact the burden placed on those who are still working.
Aging isn't a bug, it's a feature. When you get to 65, you'll notice that there's a whole bunch of stuff you didn't have time for when working for a living: now you get to do those things.
Society (and idiot commentators*) need to stop whimpering and start figuring out how to return the favor to it's retired workers who dedicated 40 years of their lives to making society work.
(I suppose you can tell that (as a 70-year old retiree) I'm really pissed at the Japanese government for it's Covid policies, which are slaughtering over 400 elderly every day. My parents made it well into their 80s, and I was hoping to do somewhat better; busting my butt on nerding out in my 70s (doing a second undergrad degree (in Japanese lit.)) and playing in the fast lane of Japanese literary commentary in my 80s. Maybe not a plan any more.)
*: especially one's with rabbits.
World population is going to stabilize at the number of births equaling the number of deaths. We can all agree on that point. Population cannot increase indefinitely. If that is the case, why is there consistent doom and gloom from economists that society will fall apart, or things won't be quite as nice once that happens? And it will happen.
It seems to me that the problem is that the economics discipline won't know what to do when they can no longer conduct the statistical analysis and curve-fitting that the discipline is built upon. Economies that aren't growing will not fit the econometric models developed over decades. One can see why this might be troubling to those who no longer have courses to teach, textbooks to write, or PhD students to mentor.
We shouldn't be troubled by societies entering a slow-growth or stable population. It will provide opportunities to reclaim degraded and polluted lands and waters. It will provide opportunities to repair and upgrade existing infrastructure rather than expend resources for expansion of roads, gas and water lines, and electrical lines.
Let's not fret over this. It just is going to be different than what we have grown accustomed to.
"If countries are smart, they’ll replenish their young populations with immigration."
There's the libertarian economist again. According to the uber-educated Left, borders are racist. According to the uber-educated Right, borders are pointless. According to the vast majority of Americans, borders are part of the definition of a nation.
I spent 20 years recovering from the single-minded, market/incentive focus an econ education gave me. (Philosophy and theology helped a lot.) It isn't that econ tools are bad; they're just more specialized than we tend to treat them. As I tell my HS students, when you're a hammer everything looks like a nail. But if it's really a screw, banging on it isn't going to change anything. And if it's really a lion, banging on it is likely to make things much worse. Too many economists see everything as nails.
I am a robust 69 year old on the cutting edge of my profession. I believe that the assumptions underlying ageism are some of the last of the -isms to be exposed and countered.
1. All of my friends, in their 70s and in fields ranging from cardiology to forest management, have cut back their work schedules but are sought after, and paid, for insights and skills gleaned from their years of experience. Income -wise, they produce more than they consume. They serve on boards, local and national, non-profit and for-profit. They volunteer for roles that hold their communities together, as our well-educated mothers once did before they were allowed to enter the world outside of domesticity.
Where is the value-added part of being an elder getting factored into your opinions? Are older people really just so much dead weight?
2. You mention only briefly the lessened demand on our natural resources from smaller populations. Given the existential crisis the planet is facing, why is an ever-growing population considered a positive and inevitable outcome?
3. I have always wondered if our current system of income-earning workers supporting non-working elders is an enormous Ponzi scheme. At some point, the music stops . Is it not possible that as our population declines there will be a temporary unbalance that at some point will reach a new equilibrium between workers and retirees? Increasing the retirement age makes sense.
Thanks for the thorough piece. Two thoughts:
1. Assuming global population must be reduced to reduce environmental impact, I also assumed solving the dependency ratio problem would be key to building consensus for reducing populations. Perhaps not, as coming generations may gladly trade a consumerist lifestyle for something simpler?
2. The scuttlebutt from my relatives in mainland China is, the deaths resulting from the move from zero-Covid were welcomed by the government as a crude way to reduce an aging population. A horrible thought, but who knows?
One additional thing that aging could affect is domestic demand. Middle-age people with kids spend a lot of money. Elderly people don’t (possibly even adjusting for the goods/services difference you mention). So an aged country needs foreign markets to absorb production more than a young country does. That could make China more economically dependent on the rest of the world than vice versa, a real political effect!
One avenue not explored here is some of the work by people like David Sinclair on epigenetics and mitigating the aging process. What are the implications of making 90 the new 60? If the body at 90 is rejuvenated, would people think and act like 60? Are Sinclair and his cohort all snake oil salesman? Should we be investing in more medical research and clinical trials?