The Neo-Classical view of the relationship between population increases and environmental degradation is a pointedly broad understanding of the issue. The Neo-Classical economists dismiss the ideas of Neo-Malthusian pessimists who draw a direct causal relationship between population growth and environmental degradation, but also simultaneously reject the Julian Simon-esque confidence in population growth as the impetus for increased innovation and efficiency (Panayotou, 260). The Neo-Classical model stresses the effects of exogenous variables upon both environmental degradation and population growth, for example government neglect of agricultural development, the lack of alternate non-farming sources of income for rural workers, and the exceedingly high cost of borrowing for farmers among others.
In this paper I will address the point of view of Neo-Classical economists
by accounting for their arguments through time and space. First, I will
analyze the Neo-Classical view of the roots of the problem in a cross-time
analysis, describing the evolution of the tension between population growth
and environmental quality as pre-modern societies adapt to modernity. Second,
I will do a cross-space analysis of how different levels of society contribute
to the problematic relationship between population growth and environmental
degradation; the household, the community, and the national economy will
be analyzed. Finally, I will discuss what Neo-Classical economists suggest
as policy proposals.
Across time: coming to grips with modernity
Pre-modern rural societies, in the past, efficiently upheld environmental
quality standards through an efficient system of collective ownership.
The need for such collective behavior was little more than the rational
desire to minimize risks - collective ownership of natural resources like
scarce water holes minimizes the personal risk of each individual in the
case of food shortage. This collective ownership avoided overexploitation
of resources by any individual by relying on social norms, through the imposition
of fines on transgressors, and other localized means of law enforcement
(Dasgupta 673).
Modernity changed all this. The entering of the state into the rural economy
upset this carefully constructed balance. State authority turned the local
commons into free-access resources, and in certain cases practiced widespread
privatization of lands as well. This broke down the existing socio-political
order in two ways. First, the ability of the collective body to coerce
an individual was undermined by economic development and urbanization (Panayotou
270). The individual now had the choice to leave the community if it punished
him too hard, and this undermined the ability of the collective body to
punish transgressions and ultimately control the use of natural resources.
Second, economic development left certain strata of rural society richer
than others, and they in turn no longer needed to rely on the collective
body to ensure their economic survival (Dasgupta 672).
The breakdown of this institutionalized collective security of natural resources
held disastrous consequences for the environment. Without the coercive
framework that held the tragedy of the commons at bay, each individual attempted
to garner a bigger piece of the pie before the pie was all gone. The parallel
growth in population further aggravated the problem. Having more and more
children became an economic necessity, as children performed some of the
most elemental tasks of capturing and appropriating open-access natural
resources. The size of the pie soon became inversely proportional to the
total number of people exploiting it, and a downward spiral of increased
children and decreasing natural resources became the norm (Panayotou 262).
The final result is a constantly evolving equilibrium that pegs a lower
level of resources to a larger population, poverty being higher with each
successive equilibrium.
In this bleak scenario, the state only aggravated the problems it had partially
caused. By concentrating almost solely on industrial and urban growth,
rural development was left in a state of cruel neglect. Without government
subsidies, the agricultural sector continued to be mired in the downward
spiral of fewer resources and more people. As the state, in most cases,
did not set up schools or other non-agricultural opportunities for income,
the rural communities remained dependent upon activities that inevitably
degraded the environment. Moreover, interest rate ceilings placed by federal
institutions severely limited the availability of credit with which the
peasants themselves could better their farming technology, irrigation, and
quality of land (Panayotou 264). Needless to say, the state in most cases
did not pursue policies to rehabilitate the environment.
Across space: the dynamics of the household, community, and national economy
The household reacts to depleting resources and the breakdown of the social
order by increasing its labor force, i.e. parents having more children.
Children, past the age of five, offer increased labor and thereby increase
the family's ability to fend for itself in an increasingly resource-deficient
environment. Children here are considered an asset instead of an economic
burden, as they bring to the table more than they consume. The economic
incentive to have children ceases only when enough children are already
in the family that the marginal utility of one more child is outdone by
the costs of having that child.
The morality of child labor aside, the child's contributions to the family
are very valuable, but the effect of these contributions are starkly negative
on society and the future. Resource depletion is hastened by the household's
decision to have another child, and this both effects the amount of resources
left for the community and future generations. This, in the long run, comes
back to haunt the large family (Panayotou 266). Once enough resources have
been depleted, there is little food left and many more mouths to feed.
The phenomenon of low food supply and too many people, coupled with a lack
of adequate non-farming employment, leads to a rural-urban shift of population.
Looking for employment, many young men leave the countryside for the city.
With minimal to no education, these youths are relegated to living in slums
and performing menial tasks to get by. The same "rule of capture"
applies here, albeit with less ferocity, as there are less open-access natural
resources to exploit in the city (Panayotou 263). Nevertheless, more children
mean more helping hands, and in extreme poverty they become a necessity
to just survive. In this fashion, the population growth and environment
degradation pattern spills into cities and places much strain on the city's
economy.
At the level of the community, increasing population has destroyed the
ability of the collective body of peasants to regulate the use of natural
resources. Challenged by nationalization ventures of the government, encroachment
by commercial firms, and by other communities, the authority of the collective
system to protect resources has eroded (Panayotou 270). Population growth
becomes an asset in the absence of this controlling authority, whereas it
was viewed as a liability in the past. This absence and its negative effects
point to the necessity of having an institution watch over common property,
lest the tragedy of the commons become a reality. The disintegration of
the local governing institution has generally not been replaced by the federal
government or a similar institution, thus the chaotic downward spiral aimed
at exhausting natural resources with increased population.
The national economy reacts to rising population and depleting natural
resources in different ways; depending upon the state of the economy, potential
for technological change, and the level of available natural resources.
In a closed and stagnant economy where all endogenous factors are held
constant, an increase in population signifies a decline in social welfare
and a diminution of natural resources. There will be therefore a desire
in such an economy to conserve the environment and substitute the use of
scarce resources with more abundant complements, but the possibilities of
substitution are severely limited when trade is minimal and technological
progress is a bleak prospect (Panayotou 273-4).
Rectifying the past, securing the future
Empirical evidence confirms the trend correlating population growth to
environmental degradation, yet the evidence is not sufficient to draw a
causal relationship (Dasgupta 674, Panayotou 276-87). The Neo-Classical
model therefore postulates a much larger scheme of explanatory variables,
in which population growth and environmental degradation fit. Along with
this broad conception of the problem that fuels population growth and environmental
degradation, the Neo-Classical economists suggest a broad range of policies
to rectify the situation and salvage what remains. Moreover, these policies
must be enacted in conjunction with another, if any success is to be achieved
(Dasgupta 675).
To save what's left of the environment, foreign expertise and assistance
is a necessity. This assistance should direct itself primarily to federal
policy reform to shift the focus away from solely urban development to including
rural development as well, and educating the peasants on how to better utilize
their land without abusing natural resources. Family planning clinics,
health clinics, and primary schools need to be set up. These would not
only reduce the fertility rate in the long run but also provide non-agricultural
income within the rural community. Social and economic structural change
must be enacted to guarantee private property rights of individuals and
community rights to resources. As may be evident, the Neo-Classical stance
is that policies for population control and environment sustainability must
go hand in hand with the general push for rural development (Panayotou 297).
How the household, the community, and the national economy respond to population growth defines the gravity of the environmental degradation crisis; originally caused by the painful transition from pre-modernity to modernity. Yet to solve this crisis, Neo-Classical economists argue, one must remove the problematic roots of rapid population growth. This entails a panacea of rural development policies addressing environment, fertility, health, and education; not simply regulating population growth as conventional wisdom often dictates.
Partha Dasgupta, "Population and Resources: An Exploration of Reproductive
and Environmental Externalities", in Population and Development Review,
Vol. 26, No. 4, December 2000, pp. 63-689.
Theodore Panayotou, "An Inquiry into Population, Resources and Environment"
in The Impact of Population Growth on Well-Being in Developing Countries,
Dennis Ahlburg, Allen C. Kelley and Karen Oppenheim Mason (editors), Springer-Verlag,
New York, 1996, Ch. 5, pp. 219-258.