An Everday Guide to Development - Part 2
Nigeria’s population growth has many reasons to cause concerns. Population growth rate is currently below the growth rate of the economy and the average income of Nigerians. This is why Nigeria has the highest number of poor people in the world, and the number of poor people will keep growing at current trends. Unemployment is high, the number of “dependents” stands at more than 88 per 100 persons - and more worrying is the fact that Nigeria has the highest number of out-of-school children in the world. Which does not bode well for the future in terms of skilled workforce and broader human capital.
Seems there is no good news to our population growth unless something drastically changes about the state of things. It is quite common to hear that Nigeria might need some radical population control measures beyond advocacy and reliance on individual choices. But should population growth really be feared? Like everything in the social sciences, the answer requires some nuance.
There are three basic issues to unpack. Does Nigeria’s current demographic dynamics indicate that the country is in a “Malthusian trap”? Is the current population growth just bad news all around or are there positives? What are the general lessons for future population trends?
WHO’S AFRAID OF THOMAS MALTHUS?
Malthusian Trap describes the state of the global economy before the industrial revolution. Suppose you have a population sharing a fixed resource - in this case land. Let us say the yield from what is planted on the land is fixed, say 50 tonnes of corn in a year. If the population using this land is simplified into a five person household and the community has 20 households, making 100 persons. If we presume equal yield and distribution for each farming household, this means that each household will get two and half tonnes of corn to consume annually. Now let us suppose our little community is growing by two households per year. By the first (after the base year) year we now have 22 households and 110 persons. But with a fixed yield of corns, each household now two and a third tonnes of corn. If we follow the arithmetic to the fifth year after our base year (30 households, 150 persons), there will only be 1.7 tonnes of corn per household. This is a simplified setting. For example we can add a simple moderate growth to the land yield. There can be a local government that collects units in corn taxes annually for keeping herdsmen away from the corn fields. The essential point is that when population growth leads to lower standard of living for the average household, you are in a “Malthusian Trap”.
FAMILY SIZE, PREFERENCES AND SHOCKS
The simple stylized example I just described was first theorized by the English cleric and demographer, Thomas Malthus. As a matter of fact I played a slight trick in my example. Assuming a fixed yield in farming is not only unrealistic, it can also be called dubious. Yields fluctuate. Some years are better, some are leaner - subject to multiple environmental conditions. What Malthus originally theorized is that humans become highly fecund with positive shocks. Positive shocks can be high crop yield from our example, or income shocks from trade, inheritance or whatever. A Nigerian version will be our episodic economic cycles of booms and busts. Periods of high oil prices are positive shocks. Or the economic expansion brought by reforms in the current democratic era. What is noteworthy is that positive shocks are not the same as sustained economic prosperity.
Positive shocks changes people’s preferences. If the Nigerian government transfers some wealth to a certain region of the country, it may encourage young people there to start families or couples to have more children. It may be that they can now afford to consume better food, or live in bigger apartments. Malthus argued that this is how humans behave - abundance leads to rising population and that threatens the average living standards of everyone in the long run. Positive shocks are temporary, but they have a permanent effect on population growth.
The world Malthus was describing firmly ended with the industrial revolution. The global economy has seen more abundance than Malthus could have imagined, and population growth has zoomed right alongside that prosperity without catastrophic consequences. So why is Malthus still relevant? Well for one, positive shocks are restricted to personal or household income. Part of the story of global prosperity is the improvement in health outcomes and the near global diffusion of health technologies like vaccination. This has lowered child mortality, leading to great population growth (Figure above). Also, beliefs and traditions shape human preferences and some of them have a permanent effect of population growth. In many parts of Nigeria, young girls are forced into early marriages rather than sent to school. There are men who still father children with multiple women, some in search of a male heir. Despite the general transition away from Malthusian dynamics; these shocks and preferences can make countries like Nigeria still susceptible to a Malthusian trap.
TECHNOLOGY AND THE GREAT SHIFT
Economic historians disagree on the exact cause of the industrial revolution that powered the enrichment of the world. But all agree that something about the world changed. Central to this change is technology. Technology radically changed the structure of economic activities. Textile mills with industrial looms replaced hand-weaving in making our attires. Automobiles and coal-powered trains replaced horses and buggies. The revolution in manufacturing and transportation drastically cut hours of work and raised output levels through the roof. What was special about this period is that enrichment was no longer a temporary shock, and hence there was an escape from the Malthusian trap. You may be puzzled as to why, after almost three centuries since the start of the industrial revolution, some countries are yet to make this escape. I will highlight two school of thoughts on the causes of the industrial revolution that may have valuable lessons for us.
Some economic historians argue that it was a demographic shift that culminated in the industrial revolution. They used evolutionary theory to model populations, and concluded that quality-preferring individuals out-competed quantity-preferring ones in fertility at some point in human history. And this might have led to the accumulation of knowledge and inventions that birthed the industrial revolution. This explanation does not claim that quality preference was responsible for the invention of technology. Humans have been inventing technology for thousands of years. Rather what this model claims is that some individuals responded to technological progress by having less children and educating their surviving children. This may be due to environmental pressures. May be irrigation expertise became more valuable in some environments than the number of hands you have on your farm. It might then lead to more parents wanting to raise more irrigation experts than just farm workers. This will require investment in sending their children to learn from current irrigation experts. The children can then grow up to pioneer other ways of irrigating farmlands that further improves the prevailing system. This model makes two symmetrical predictions; the first is that if quality prevails over quantity, you can get the industrial revolution. The second prediction is that if the dynamics changes and quantity prevails, then you will be back to the Malthusian era.
Environmental pressures may no longer be similar to the past, but I suspect the effects are the same. In Nigeria, our population dynamics does not seem to be quality-preferring. Education is no longer optimized for skill and chronic unemployment has lowered the returns to education to make the investment worthless. This needs to change if we want to benefit from population growth. More of our children need to be in school. More importantly, they need to be actually learning. University and graduate students need to learn by “doing” rather than mere “schooling”.
Another school of economic history believes that a cultural shift was the catalyst for the industrial revolution. At some point in human history, ideas and values about commerce, profit, and invention gained traction and respectability with a large number of people. Critics often dismiss cultural theories as relying too much on a “sky hook”. This misses the point. Culture is the primary way for human learning before we had schools - and most learning still happen through culture. One form of learning in history is imitating successful or prestigious people. From our earlier example, we can imagine that if irrigation solves a persistent problem people were having with farming; then irrigation experts will gain some relative status within the population. People will admire their status and want to imitate them. Irrigation expertise will then have elevated status in their minds, such that they want to do it or at least make their children learn. The culture of growth and innovation are not respectable in Nigeria. Perhaps because the system rewards patronage than ingenuity. But we can’t keep blaming the system for our culture. Cultural evolution is faster than biology, and societies are more connected now than ever. I do not know how much environmental pressure we need for that to happen. But we need to embrace endogenous change. We need to learn to build rather than plunder. We need to start “making” a lot more than we think about “taking”. This is how cultural change can reach the needed critical mass for a population boon. Cultural and demographic shifts need not be in conflict, they are two valuable sides of a multi-sided social die.
CONTROL AND CONSTRAINTS
It quite common to hear that Nigeria needs to adopt some radical control measure regarding population growth. This feels to me like we have totally given up on economic growth and we need to keep managing our lives with scarcity economics. China’s “One-Child Policy” (OCP) is usually held as the standard. Needless to say that Nigeria lacks the bureaucratic capabilities that is required to enforce such a policy. Beyond that, there are long term consequences to forcing natural fertility down. A recent study of China’s OCP concluded the welfare gains in standard of living only lasts two generations (40 years) after which it retards growth. The effect may be even worse for Nigeria because China has had a more steady and sustained period of growth. Population growth should not be inherently feared. Yes, there internal constraints and Malthusian dynamics in each country (Rural and agrarian states in Nigeria may have “tight” Malthusian constraints - the sensitivity of living standards to population increase may be higher in such states. Urban centre or cosmopolitan states may show a more “loose” effect). High productivity and denser regions are less prone to Malthusian traps, and engineering such should be high on the policy agenda.
LETTING IDEAS HAVE SEX
Constraints are not destiny. Technology already enriched a greater part of the world. Such miracles still do happen everyday. Ideas underpin how technology powers growth. If you invent an internal combustion engine, then document your blueprint faithfully. I do not need to reinvent the engine to power my factory. I may have to pay you for your intellect and genius, but that is small price. Inventors throughout history only capture a very small amount from the proceeds of their inventions. In the global world of today, know-how do not even need to be reproduced, they just need to be transferred. Creating the right incubator for such knowledge transfer to happen has proved challenging. But we all know it should not be that hard.