Does being an only child matter?
Our answer starts with a sunflower seed story.
There once was a poor Chinese farmer who believed he could excel at nothing but sunflower seeds. Traditionally sold in bulk with other types of nuts, sunflower seeds had been nothing unusual. But then calling them Idiot’s Seeds, the farmer, Mr. Nian, stir-fried, salted, and packaged them. Soon, during the 1980s, millions of people in China were munching Idiot’s Seeds as they watched TV or played cards.
This takes us to China’s economic growth. According to an M.I.T. scholar, entrepreneurs like Mr. Nian fueled growth during the 1980s but then, after 1990, were constrained by the spread of SOEs (state owned enterprises). Now, a new study suggests another way that the Chinese government might be diminishing entrepreneurial initiative. Comparing Chinese children born before and after the one-child policy began during 1979, Australian researchers have concluded that being an only child in China could make you less willing to take risks, compete, trust people and be trustworthy.
So yes, with their GDP second only to the US, China’s economic growth has been meteoric. And their population growth has slowed (see below). However, their male biased one-child policy might have unintended economic consequences.
The UN line reflects current policy while the second line indicates the results of universal implementation.
Sources and Resources: This marketplace.org series of reports is a superb summary of China’s one-child policy. An excellent complement, the Australian research on the impact of single child is described in this Science Magazine podcast and transcript. (The study is gated.) Also this Bloomberg article and BBC article discuss the research and here is The Economist link for the above graph. Finally, for more on the Chinese economy, you can download the first chapter of Capitalism With Chinese Characteristics and also go to econlife here (where I first told the sunflower seed story), here and here.
On October 12, 1999, according to the United Nations, the 6 billionth person (approximately) in the world was born. At the time, the UN projected the arrival of number 7 billion during 2013. Now though, the due date has been changed to this Monday.
With 8 and 9 billion soon to come, in 2025 and 2043, a NY Times Op Ed asks whether we will need “a bigger pie (more productive technologies) or fewer forks (slower population growth through voluntary contraception).”
As we noted in this econlife post on the 5 ways to double our food supply by 2050, don’t we first have to figure out the right incentives?
The Economic Lesson
Perhaps one of the first environmentalists, Reverend Thomas Malthus (1766-1834) told us that population grows geometrically while resource production expands arithmetically. Consequently, resource prices will rise and supply will become increasingly inadequate. Less concerned, Malthus’s friend, David Ricardo (1772-1823), said that free trade would diminish the problem.
An Economic Question: Whenever a transaction between two parties affects a third, uninvolved individual or group, economists see an “externality.” Which good (positive) and bad (negative) externalities might population growth create?
The world is getting richer. And richer people eat more meat. And the animals they eat consume more food. Also, everyday, the world has more people.
The bottom line? According to a study from Nature, we have to double the world’s food supply by 2050.
The good news is that the study’s authors have 5 suggestions for increasing the world’s food supply. The bad news is that they appear not to have taken economics.
First, the suggestions:
- Stop the spread of agriculture. For example, we should not replace forests with farms.
- Increase the yield of “underperforming” acreage. Comparing Africa to Illinois, the wheat yield is 1 to 6.
- Enhance “cropping efficiency.” Fertilizer and water might be used more efficiently.
- Change what we eat. If we eat less meat then we have fewer animals to feed.
- Diminish waste. Rich countries throw away a lot. In poor countries food spoils.
According to NPR, at a recent presentation, one of the study’s authors was asked, “What about economics?” If economic incentives created our plight, then don’t we need new incentives? What, for example, will stop newly affluent consumers in China from eating more meat?
Here is a past econlife post on feeding the world.
The Economic Lesson
Perhaps one of the first environmentalists, Reverend Thomas Malthus (1766-1834) told us in 1798 that population grows geometrically while resource production expands arithmetically. Consequently, resource prices will rise and supply will become increasingly inadequate.
An Economic Question: For each food supply solution listed above, what incentive would you suggest?