Finance & Development, March 2016, Vol. 53, No. 1

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Population Pressures

Say “population growth” and many people immediately think of resources under stress. The mind jumps to 19th century scholar Thomas Malthus, who saw population outstripping the food supply, or to Paul Ehrlich, whose 1968 book The Population Bomb warned of global catastrophe from overpopulation.

Visions of a world depleted by humanity are embedded in popular culture, and in some corners of the world, population surges are a top concern, placing severe pressure on land, labor markets, and government budgets. But this notion of population growth speaks to only part of the story. Multiple forces—aging, migration, urbanization, and longevity—are creating a more diverse and complex global demographic landscape.

The full story offers surprises—some countries face a problem of too few people, not too many—and potential: some countries are positioned to realize a “demographic dividend” based on an expected boom in working-age adults while others can seize big economic gains if they are able to boost female participation in the workforce.

These crosscutting dynamics define population change today and are the focus of this issue of F&D.

David E. Bloom, Harvard professor of economics and demographics, opens our special feature with a survey of the forces shaping population growth today and proposes a range of options for managing what he calls “the most significant demographic transformation in human history.”

Other articles in our feature package focus on the fiscal consequences of shrinking and aging populations; the role of women in offsetting the problems of an aging population and shrinking workforce; linkages between age and inflation; and how sub-Saharan Africa can reap the benefits of its growing population.

Elsewhere in the issue, we tackle topics dominating news headlines, with articles by IMF First Deputy Managing Director David Lipton on China’s need for bold fiscal reforms, IMF economists Paul Cashin and Mehdi Raissi on the economics of El Niño, and IMF Middle East Chief Masood Ahmed on plunging oil prices.

Rabah Arezki, Frederick van der Ploeg, and Frederik Toscani break new ground in their article on the latest trend in natural resource finds. For those readers fascinated by the subtleties of central bank communications, former Reserve Bank of India governor Duvvuri Subbarao reflects on the power of words in a first-person account of his years at the reserve bank. Peter J. Walker profiles economist David Card, whose work on minimum wages, immigration, and education challenged conventional wisdom.

Finally, we included a tribute to pop icon David Bowie, who passed away in January and inspired millions with his music. F&D Managing Editor Marina Primorac tells us how the musician’s face came to grace the front of the “Brixton pound”—a local currency that circulates in that south London neighborhood where Bowie was born.

Jeffrey Hayden
Editor-in-Chief