These latest projections have reignited the debate about whether the world can feed and water that many people. These concerns are not new. In 1798, Thomas Malthus predicted in his book An Essay on the Principle of Population that population would grow more rapidly than food production because the amount of land available for agriculture was fixed. His argument is predicated on the economic law of diminishing marginal returns – that as we add more and more variable factors of production such as workers and seeds to our fixed amount of land these variable inputs will produce smaller and smaller successive increases in total output. Essentially, he predicted mass starvation, something which became known as the Malthusian catastrophe.
In 1967, Paul Ehrlich wrote an article for the New Scientist that followed in Malthus’ footsteps. In that article, Ehrlich predicted that the world would experience famines sometime between 1970 and 1985 due to population growth outstripping resources. Ehrlich wrote that: “the battle to feed all of humanity is over … In the 1970s and 1980s hundreds of millions of people will starve to death in spite of any crash programs embarked upon now.” The article led to a book called The Population Bomb. This sentiment has been echoed since by other authors including Jared Diamond and Dennis Meadows to name a few.
However, since Malthus’ time, population has grown over 800 times and yet we’re still surviving. Why? The ‘law’ of diminishing marginal returns only works under the assumption of fixed technology. If we can innovate we can break the law and continue to grow. Innovations that made the limited stock of land more productive include irrigation, pesticides, nitrogen fertilizers and the crossbreeding of crop varieties. Together the spread of these technologies from the developed to the developing world was known as the Green Revolution and one of the key players was American agronomist Norman Borlaug. He won a Nobel peace price for his work which focused on crossbreeding crop varieties to develop high-yielding crops which wouldn’t fall over under the weight of their produce.
The underlying economics here is that things change and that prices provide powerful incentives to innovate. As the prices of fixed inputs rise (e.g. land) there is an incentive (a market) to innovate to use less of this relatively expensive input. Originally we had innovations which use less land (e.g. fertilizer or high yielding crops) and more recently innovations which saved expensive labour (e.g. robots in car manufacturing).
This is what Sir John Hicks called induced innovation and it’s set to continue. As the price of oil skyrockets we’re seeing more energy efficient vehicles and industrial processes. What will be next? Who knows but as long as prices reflect scarcity I’m confident that the market will provide adequate incentives to find innovative solutions to our problems. Therefore a more worrying change is not in the population size but in its composition. The world’s population is getting increasing old and we need to adapt to this such as allowing people to work longer, encouraging people to make adequate financial provisions for the retirement and encouraging people to live in homes of an appropriate size.