Demographic Change: We Are DOOMED!

Or are we?

The great guys of  Wissensmanufaktur (German economic dissidents; lit.: Knowledge Workshop) have layed out what really happens while the Germans get older and fewer. (Assuming no large scale immigration/invasion)

Short German MMNews article

The gist of it is:

  • Over the next 20 years, German working age population shrinks by at most 21%
  • Over the past 20 years, productivity per working hour grew by 35%.
  • Meaning that, under the realistic assumption of continued productivity growth at this speed, at least 7% more goods and services per person will be available (this their worst case scenario; the best case 21.5%)

I have oberved a similar thing for Japan vs. USA from 1990 to now: While Japan had their Lost Decades, the USA had the roaring 1990ies.

Really?

Japan had NO population growth all those years. And shrinking population now. While USA had about 1.5% internal population growth topped up by 2% growth through legal and illegal immigration. So how does the picture change when you look not at total GDP but at GDP per capita?

It turns out that USA and Japan developed approximately in parallel under that criterion.

I’m obsessed with GDP/capita because I’m not a nation state, I’m an individual and that’s the measurement of MY wealth. Turns out other people have observed it as well:

The Myth Of Japan’s Lost Decades

(with chart)

P.S.: But the Germans are going extinct! I hear you say.

Oh Really?

 

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2 thoughts on “Demographic Change: We Are DOOMED!”

  1. Basically Japan and Germany (and several other countries) have found a population equilibrium for the time being. Why continuous exponential population growth? Is this not exactly the panic that all the overpopulation gurus spew all the time?
    So where is the problem if German’s population is not following the Bangladesh or Nigeria path?
    https://en.wikipedia.org/wiki/Demographics_of_Bangladesh
    Even here the same trend is observable: “Bangladesh had high rates of population growth in the 1960s and 1970s. Since then however it has seen a marked reduction in its total fertility rate. Over a period of three decades it dropped from almost 7 to 2.4 in 2005-2010”
    As you nicely show the productivity increase can compensate for reduced number of persons in the workforce.

    Like

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