Without Babies, Can Japan Survive?
nytimes.com
nytimes.com
"Although Japanese couples consistently say in surveys that they would like to have more than two children, they don’t. Part of the problem is Japan’s prolonged economic malaise. Years of stagnant (or declining) incomes have made Japanese men less attractive as potential partners. And economic uncertainty has led couples to delay getting married and having children. The shortage of public day care centers, especially in cities, has made the cost and burden of parenthood so high that today’s couples either have fewer babies or none at all. (Japan’s birthrate is just 1.39 children per woman.)"
What happens when the population shrinks as a result of this? All of these problems magically right themselves.
Shortage of public day care centers? Solved with lower population.
Stagnant or declining incomes? Solved with a lower population, as each person can command a greater share of the economy (in aggregate) from simple supply/demand of labor.
This is just a pendulum swinging back into equilibrium that will eventually be felt across the globe - and while worse for Japan's Gross GDP, it will improve Japan's GDP per Capita, the only truly important 'country level' measure for actual citizens.
Less young people means a small amount of young people paying for lots of older people, which is a large financial burden on the people able to work. (as well as many other factors)
Also, GDP per capita is only used to measure money. There are many other factors that people might find important like happiness rankings, which to me happiness can be much more important than money.
Higher incomes are also closely associated with better education. If you keep the number of universities and schools constant while decreasing the population, you give a larger percentage of the population access to better education.
If a family has two children, the wealth of the family must be divided between both children and each child has less individual wealth. As you need wealth to start a business, a higher base wealth across the population means more chance of new successful businesses being started by these children.
If a family has no children, the estate will move into public control, effectively increasing GDP per capita for the surviving population.
A reason for a low birthrate in Japan is lack of financial security. This means that people who have low wealth are self-selecting out of reproduction, effectively moving their wealth into public ownership when they pass away and moving the average up as the proportion of low wealth to high wealth families is shifted.
So yes, practically, GDP per capita will go up in Japan as the population shrinks. The global economy is more complex than just 'producing shiny widgets', or China would be far more well off than it is. Capitalism in action.
EDIT: As pointed out by others correctly, increased welfare burdens from too large a proportion of retired citizens will have an effect. This can swing two ways: increased taxes, or reduced welfare payments.
If reduced welfare payments is chosen, it will cancel out the problem. Japan will hopefully choose this route out of self preservation.
If increased taxes is chosen, it will effectively tunnel income into the housing sector (old age homes, etc) and medical sector (medicine, life support, etc). The housing sector increase will be offset by a smaller housing demand from lower population. The medical sector is the big issue: if this wealth can be tunneled into Japanese medicine and health care, then it will simply be a transfer from taxpayers to Japanese in the medical sector. This would probably cause all kinds of distortions and should be avoided. However, it's not guaranteed to be a bad thing, I think anyway. You'll just have more Japanese going to medical school.
Inherited wealth isn't enough to sustain anyone but the rich. GDP only measures new wealth anyway, not preexisting wealth. You have to continue producing goods and services. In fact, most forms of accumulated wealth (currency, securities, real estate) are really just shares of these goods and services as they're produced, but you need at least some actual labor for that to work.
If you selectively culled unproductive people, per capita GDP would go up. It's not clear that low birth rates accomplish this.
[unique skills - ceos, etc]
X people
[highly demanded skills - top class engineers, specialty surgeons, etc]
Y people
[regular required jobs - doctors, pharmacists, designers, etc]
Z people
[unskilled jobs]
A people
[unemployed]
This is just a few examples, but you could easily find far more. The root cause of this is the existing wealth of the country will enable more people to succeed as the population decreases. A further indication of this effect is that GDP per capita is strongly related to wealth.
For engineers it's a supply side issue--we could productively employ many more engineers than we do, but it would take immense breakthroughs to have a population where everyone could be an engineer. That's what I meant when I said you'd have to selectively cull the unproductive. If you reduce the population, the remaining workers have to be more productive for per capita GDP to rise, and you still haven't shown that this would happen. It doesn't help if you only need 10,000 engineers when you can only produce 0.01 engineers per capita. You'd need this proportion to rise. How does lowering birth rates do this?
In other words--sure, you could probably have a very per-capita rich Galt's Gulch with only 1000 people. But reducing the population arbitrarily to 1000 people will not accomplish this.
I'd think that families that have significant wealth are the ones that are the most likely to have children, since they'd have no problems affording them.
Workers might have been able to command a much higher salary a century or two ago, but in global world there is only so high the salary of an individual can go before the entire thing comes crashing down into a gigantic economic disaster.
Regarding gigantic economical disasters, consider what will happen when the current generations retire. Unless the government has put enough aside to pay for the retirement of all these people (very doubtful), then it must get whatever it can from the citizens who are working -- and with a very small amount of people working, that means that each worker will have to pay a lot more in taxes, which is not likely to lead to either economic prosperity or reelection of the politicians (even though their hands will be completely tied down).
Can you explain why more people causes price to go up?
Quantity will certainly go up, but only in proportion to population, thus having no net effect on GDP per capita.
Sure. As you know, price is the intersection of supply and demand. An increase in a population is, in economic terms, an increase in demand. This will cause the price level to increase.
Over time, supply will increase to match the new demand level, but to what extent and more importantly, the time frame involved, will be dependent on the good/service in question. The supply for some goods and especially most services, isn't easily increased. There is a finite number of lawyers, doctors, etc. to provide services and it take time to train more. Regulations get in the way, licensing, etc. And, of course, there are pressures on the raw materials used to manufacture goods.
Of course, in this world price goes up but quantity remains flat (in gross terms, not per capita). Real GDP per capita drops even if inflation drives up nominal GDP per capita.
Is that what I said? I thought I said there's a delay between an increase in demand and an increase in supply, which results in an increase in the price level. In a world of constantly increasing demand you have a constantly increasing price level. In other words, real inflation.
In a world of stagnating population growth, you'll have stagflation at best, and deflation at worst. Guess what's happening in Japan?
Real GDP per capita = gross medical services provided / population
If population goes up but gross medical services stay flat, real gdp per capita falls. Nominal GDP per capita can rise of the elasticity of demand of medical services is greater than one.
Being temporary just means that real GDP per capita will eventually reach it's previous level - a temporary Malthusian nightmare rather than a permanent one.
Human beings aren't static units of consumption and production.
Most productivity gains which result in real GDP per capita growth can only manifest themselves at specific economies of scale. Economies of scale realized after specific demand levels are reached as a result of growing populations.
The pressures which lead to innovation are directly tied to the pressures caused by additional demand and insufficient supply.
Can you name a single country with a decreasing population and a growing GDP? Or even a growing per capita GDP?
Japan.
Population
2005 127,767,994 +0.7%
2010 128,057,352 +0.2%
2012 (est.) 127,530,000 −0.4%
http://www.indexmundi.com/g/g.aspx?c=ja&v=67
EDIT: This is, of course, also not related to inflation, as Japan has had deflation for years.
http://www.rateinflation.com/inflation-rate/japan-historical...
So perhaps I am not wrong on a profound level after all, considering my views are echoed by reality? Just throwing it out there...
According to this:
https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&...
Japan's population begins to stagnate around 1996 or so.
Use this chart and restrict the data from 1996 to today.
http://www.tradingeconomics.com/japan/gdp-per-capita-at-curr...
Now use this chart:
http://www.tradingeconomics.com/japan/gdp-growth-annual
Again, restrict from 1996 and onward. Then select trend. A nice downward line trending toward 0.
The true effects of a stagnating population won't be felt for years. As the article notes, Japan's population is aging rapidly. That means fewer and fewer productive members.
This is the same problem that's looming for the Social Security system in the U.S., and probably in most developed countries, as average lifespans increase. (A much smaller percentage of people actually lived to retirement age when the Social Security system was first created.) But this problem will hit Japan first due to their low birth rate.
Demographic change is a real challenge, and all industrial societies are heading for that kind of cliff. Japan's is larger than most (but smaller than China's), and they are going to get there first. But this isn't the kind of disaster being posited. It means, broadly, that for a generation or so society will be burdened by a disproportionately large elderly population, and caring for them will require resources that we'd prefer to spend on other things. But eventually things will return to a steady state, just with fewer people. We'll manage.
Edit: http://en.wikipedia.org/wiki/Total_fertility_rate#Replacemen...
According to Wikipedia's source, replacement rate is ~2.1 for developed nations, so I would guess Japan is definitely not at a replacement rate at 1.4. Of course, replacement rates are just to keep population steady, but I would think a country with too many old people is still somewhat of a problem, unless you could figure out how to take care of them and/or make them productive.
To my knowledge no other modern society has had a birthrate drop like this - to below this radically replacement and has then stabilized the birthrate at the replacement rate (or above). This really could be free fall...
Hardly. One generation where the average is 10 children per woman will boost the economy and permanently change the demographics; it may sound completely unrealistic, but it was the norm only a few generations ago.
And no, it didn't end when a lot of the children stopped dying in childbirth, as my grandfather had something like 8 brothers, and all of them made it into adulthood just fine.
You say that things will return to a steady state, but why do you believe that?
In fact, it's often the opposite of what the article states - there's a trend among women called Nikushoku joshi （肉食女子）, or carnivorous women, where the women are actively pursuing men out of necessity.
0: http://en.wikipedia.org/wiki/Herbivore_men
1: http://www.washingtonpost.com/wp-dyn/content/article/2010/10...
http://dontmarry.files.wordpress.com/2009/03/sexualutopia.pd...
From the point of view of evolution, birth control is a disaster. I have done exactly the activity evolution has programmed me to do to continue the species, regularly, for over 20 years. Only twice did it result in children, and both times were conscious choices on my part.
However evolution knows how to face these disasters. There is a small minority of people who have the option of birth control, who have all of the same economic incentives that I do, yet choose to have lots of children. Their children are less likely to want to use birth control than mine. Thanks to exponential growth, that minority that chooses to have children regardless will become a majority. And after that point, voluntary birth control and economic incentives will not suffice to keep the population from growing.
This is literally evolution in action.
And while Mormon's rapid breeding might prevent demographic malaise, the rapid breeding of low conscientiousness people won't - the very trait that causes them to breed rapidly also causes them to be generally unproductive.
Birthrates are falling rapidly around the world, yes, including in places you may think are populated with "low conscious" people. The reason is very prosaic: urbanization. As people get crammed into smaller areas, they naturally start to reproduce less.
It goes back to the fundamental human urge to take care of our offspring: an overcrowded city is also a highly competitive city (Tokyo, Hong Kong, New York etc illustrate this best) so people who live in that environment that don't want to bring more offspring into the world.
Even in a country like India, the population growth is almost all rural. The birth rate of city-natives in big cities has dropped well below replacement level, and cities are gaining population because of immigration and within one generation those rural-turned-city-dwellers have low birth rate.
If population A (e.g. mormons, people of low conscientiousness) has a birthrate of X, and B (everyone else) has a birthrate of Y, with X > Y, then population A will eventually become the entire population. The eventual birthrate will be X.
Even if both birthrates are reduced by some exogenous factor K (e.g. urbanization, reducing from X -> K x X, Y -> K x Y), this fact doesn't change.
One way to think of this is that, instead of the physical birth rate of people with the trait, what is the rate with which the trait manages to reproduce itself? A trait of "being Mormon" with an average of 6 kids, of whom 2 become Mormon, leads to a Mormon population of stable size, forever having 6 kids per couple.
If the Mormons manage an average of 2.5 Mormon kids per couple, then their population will grow without bound, though they may never be an actual majority of the population. However history shows that culture is malleable. They may grow that fast now, but a rapid social change can destroy the dynamic. (Witness Italy and Ireland, both strongly Catholic, with declining populations.)
Now contrast this with, say, a genetic trait that manifests as a strong desire to actually have children. Eventually you get a population of people who really want children, most of whose children really want children. This type of fundamental desire is more stable than a social construct.
I believe that there are such traits out there in the population. They are much more strongly favored today than in the past. Eventually those traits, whatever they are, will become more widespread, and evolution will have happened.
Great-great-grandparent:
> Secular culture has managed to peel away many of their kids in recent decades but [...] that process is about to change
However I, personally, see no sign of that process changing. Popular culture does not have to be good to pull away the children of religious people. It merely has to be attractive. And popular culture is constantly, relentlessly, optimizing for shallow attractiveness.
For some bizarre reason, Irish people love having babies.
Full disclosure: I am a childless Irish male in my older 30's, I know many people I grew up who have had kids since the economy went into the crapper.
I personally suspect that the long oppression of the Catholic Church under English rule lead to a cementing of how important it is to the Irish people. I further suspect that, in time, Ireland will become as secular as other countries. But that time is not yet here.
As a random example it is known that genes play a big role in causing ADHD, which is associated with a variety of risky behaviors, which might conceivably be correlated with increased reproduction rates.
If ADHD people has kids 10% faster than the rest of the population, then in something 30 generations, we'd expect over half the population to have ADHD. That's about 750 years. (I do not know if this is the case with ADHD. I'm throwing it out as a random example. For all I know there is no real difference. Or, in the presence of birth control, a 20% difference.)
It isn't just ADHD, though. Every possible genetically determined characteristic that limits how effectively birth control prevents you from having children is now being aggressively selected for. All else remaining equal, in a few hundred years we are likely to see significant behavior shifts in our species.
If you compare the birth and death rates they have only recently crossed, http://en.wikipedia.org/wiki/File:Bdrates_of_Japan_since_195... which means the value of land is increasing as more people compete for the same resources.
For example, as the population starts to decline housing will become cheaper which will reduce commuting times and debt. Which will make it much easier to start a family and should increase the birth rate. It also dramatically reduces the need for new infrastructure.
Also, their politics is probably more screwed up and dysfunctional than this article suggests, so any change seems unlikely.
Surprisingly the process to get a work/student visa in Japan is much more easier than in Australia or the US (I've applied to one or another in all these countries and it's such a breeze to do in Japan).
Despite that, immigration remains low. For the foreigners here, last time I checked it was basically composed of about 80% of foreigners from China, 15% from Korea and the remaining 5% from the rest of the world.
I suppose the difficulty of the language and geographic location has something to do. Racism as known in the West is rare, but the truth is, Japan has consistently failed to assimilate any foreign population and it is really difficult to explain how it is like. I guess it's definitely more like a Canadian "cultural mosaic" more than an American "melting pot". But the cultural mosaic has some sense of equilibrium. For the case of Japan it would look more like "patching the kimono with pieces of fabrics of different patterns".
The thing is, under the hood, legally speaking, Japan is very open and welcoming to foreigners, but it fails to keep them in or assimilate them.
If it is skilled work, I recall any undergraduate degree overseas plus a job offer are the main requirements you need to get a work visa. Yes, no need to wait for a space to open as is the case with the H1 visa in the US. And I think this year the process got even easier.
To get a contract, well, if you can speak Japanese then you are halfway there. If you can't, I can suggest:
1. The companies that seem to be hungry for IT/software engineers (judging from the amount of spam I get from recruiters), may take your from whenever you are, and where probably Japanese language skills are not important are: GREE, Rakuten, Amazon Japan. I think you can apply to those through their websites.
2. Message me so I give you a list of recruiting companies that seem to specialize in foreigners in Japan.
3. Some people recommend checking out www.gaijinpot.com from time to time.
But it gets a bit more complicated.
How would you solve the issue of no-go zones, crime and violence, incompatibility and intolerance, and lack of unity?
Because those are all the things that increase in a non-marginal way when you mass immigrate a society and start replacing its identity, culture, and people with another.
Would you build more prisons? Would you make excuses for the new people? What would you do exactly when that same society starts breaking apart?
7 people.
Obviously I don't think it would actually get there but that is the current rate if nothing else changes (or rate at the time the program was aired)
The segment ended with a tongue in cheek admonition to make a baby tonight for Japan :)
Japan's population has been essentially flat for the last 6 years: 127,773,000 in 2005, 127,817,000 in 2011. It is headed south as long as the birth rate remains so low. So no question that the rest of the world needs to understand the effects of negative population growth. A decreasing population will test many economic policies that relied on monotonically increasing population to be effective. I doubt we can predict all of the policies that will break.
The low birthrate is caused by overpopulation: there's too little resources to give to babies, so it's impossible to have children. I would actually say, there's so little to go around, people can't form families (get a partner, be a couple - maybe because the courting ritual is too elaborate now), so less people are even able to have a go at having a child.
Having said that, why would anyone live in the remote countryside? In a rural town? We can't bring modern standards of entertainment and culture to the countryside. Museums, clubs with modern live music, theatres, circuses - you can't have that and that's what make you a modern person.
I guess most people will be living in fifty kilometer radius from a million plus population hub. That's what we should have.
Just to satisfy my curiousity, how many people were in your society to begin with? At what age did they reproduce? Was the reproduction constant or did it change between couples?
10000. They reproduced between 25 and 35. You could tune the birth rate but it was constant for the simulation. People lived for 80 years. This kind of setup gave you a temporary boost and then a surprisingly hard landing.
The USA has a birth rate just barely above replenishment (and dropping), Europe has dropped below replenishment rate, etc.
Some pretty graphs here: http://andrewducker.dreamwidth.org/2776214.html
If you have a workforce in their thirties who are still at entry level positions or thereabouts, and a majority of voters between the age of 50 and 80, you end up with a political class that wins elections with pro-retirement and healthcare policies and a tax-base that has no way to pay for it. This is a recipe for disaster and it’s already happening in Japan. It could easily happen in any aging population.
If the planet cannot "easily" support the number of people we have now, please prove how. Because right now it isn't.
But for you to suggest that it is morally improper to have children because the world can't sustain it -- no, I'm not going to sit on the sidelines and listen to this non-sense. You go ahead and prove that the world isn't supporting the population without utilizing corrupt governments. It is insanity that some would have us roll back to the population and energy consumption 1800's because they have cannot come up with a modern solution.
Last, but not least, China reduced it's population. Would you call it a stellar example of environmental responsibility? Your problem is that you're conflating two completely different problems. Overpopulation (for today) is a non-existent problem. Fix destitution (a real problem) in the developing world, and birth rates will drop naturally.
tl;dr I make some assumptions about environmentalists. Fight poverty, not birth rates.
Tokyo literally employees people to shove commuters into rush-hour trains. Who wouldn't want to live in a Tokyo with the same infrastructure but with 40% fewer people using it? Sounds pretty good to me.
In the long run, productivity growth and technological changes will dwarf demographics. I'm not talking huge Mr. Fusion-style breakthroughs, just small improvements that we all see every day. The Radio Shack catalog from 1982 that was posted here a few days ago is a great example. The improvements since then happened so gradually that we don't even notice them until we look back 30 years.
If you mean just the city of Detroit, then the comparison with rural Japan is not too far off: young people moving away from their homes because there are no jobs, leaving behind their parents and grandparents. Detroit is the rural Japanese fishing village with 1 grade-school kid in this analogy.