Both of the articles assigned for this week concern per capita growth, but in two ways. Sheehey’s article “The Growing Gap between Rich and Poor Countries: A Proposed Explanation,” (1996) is seeking to propose a mechanism to explain divergence. Barlow, however, is offering a new variable to Simon’s two variable correlations between the rate of population growth and the rate of growth per capita income. Sheehey, in a sense, is also modifying the Simon correlations in saying that it is not actually the rate of population, but the population growth relative to the labor force growth that correlates to per capita income and then results in divergence between the rich and poor countries.
Barlow, in response to Simon’s challenge, has added a third variable: lagged fertility, in order to better predict current per capita income growth and explain why economic growth is positively related to lagged fertility. What occurs is an explanation that is well illustrated and accurately describes what has happened in Asia in recent years. Basically, high rates of per capita GDP correspond with high lagged fertility and low current fertility. This means that high fertility in the past will yield strong growth today, even if current fertility levels are low. In the future, however, this lagged fertility predicts much slower growth because low current fertility levels will translate into low lagged fertility levels in seventeen year’s time. So there are strong implications, in this study, for demographic transitions. He is also distinguishes between the short run result, which has negative effects and the long run Malthusian effect of positive results.
Sheehey seems to be dealing with a similar phenomenon in saying that the difference between population growth and labor force growth varied with income level. His mechanism is more concerned with differences between countries. In an LDC, as population grows faster than the labor force, seen in the early stages of transition, dependency ratios rise and output per capita falls. Conversely, in developed countries, population growth slows and the labor force growth remains higher and per capita income rises. Using output per worker, one does not find the same phenomenon of divergence to nearly the same extent between the wealthiest and poorest countries. Hence population growth, as a variable itself, such as in Simon’s model, ought to be divided into growth of labor force relative to population growth.
Much like Barlow, Sheehey is really looking at the relative size of the labor force to the rest of the population. Both seem to me to be getting at Macunovich’s relative cohort size idea, and using it to address more specific issues such as labor force size and demographic transition. This can be explained by lagged fertility in which a large relative cohort will mature to an age where they enter the labor force, although Barlow does not specifically emphasize the significance of the time lag. He is addressing the same issue of dependency and so on as Sheehey, who is looking at labor force growth relative to population growth. Again, a large relative cohort size has a strong effect on the difference between these two factors.
Of course, both men offered a statistical analysis to show their correlations, and spent the bulk of their articles explaining that aspect of their work. It is really not surprising, after having read Macunovich’s article, that the size and relative size of the labor force seen also in the same manner as lagged fertility, affects output and income per capita as well as playing an explanatory role in divergence and convergence.
Barlow, Robin "Population Growth and Economic Growth: Some More Correlations.” Population and Development Review, Vol. 20, No. 1: 153-165.
Sheehey, Edmund J. "The Growing Gap Between Rich and Poor Countries: A Proposed Explanation." World Development, Vol. 24, No. 8, August 1996: 1379-1384.