Wednesday, June 27, 2007

More People, More Progress?

In Knowledge and the Wealth of Nations, the author states that the rate of technological progress is based on population size. A larger population can support more researchers which leads to more scientific breakthroughs and improved technology. As an example he asserts that when Europeans discovered Australia, their technology was vastly superior to the Australians because the population of Eurasia was much larger than Australia. Likewise, the Austrialian technology was superior to neighboring Tasmania, whose population was so small that their technology had actually regressed.

This made me wonder: what is the link between population size and technological progress? Would a larger world population lead to quicker technological innovations? And what is the impact of countries becoming richer on progress and how does that compare with population growth?

So, I decided to investigate.

I pulled out the UNESCO reports on the number of researchers in the world, that I wrote about previously. Based on these numbers I calculated the numbers of inhabitants per researcher and GDP per researcher.

per researcher
GDP (in millions)
per researcher
Developed Countries3057.2
Developing Countries2,67011.6
Less-developed Countries221,600237.5

For the entire world, there are 5.5 million researchers in a population of 6.1 billion, or 1,120 people per researcher. All else being equal, there would be another researcher for every additional 1,120 people added to the world population. If the population were to increase by 1 billion, there would be an additional 892,000 researchers, increasing the total by 16% and speeding up the rate of technological advancement.

But, all is not equal. In developed countries there is one researcher per 305 people (228 for the US), while in less-developed nations it is one per 221,600. 1 billion people added to developed countries would lead to 3.28 million new researchers, while that many added to less-developed countries would add just 4,500 researchers. Unfortunately, from a research point of view, the majority of population growth is occurring in developing and less-developed countries (and two of the countries with the highest rates of researchers per capita, Japan and Russia, are experiencing population decreases). This also raises an interesting question of whether migration from less-developed to developed countries would lead to more researchers. It cannot be determined from this report, but it seems plausible.

What if instead nations were to get richer? How much additional GDP do we need per additional researcher?

For the entire world, there is one researcher per $8.6 million in GDP. If the world GDP were to grow by $1 trillion (a 2.1% increase on $47.6 trillion), there would be an additional 116,000 researchers. Once again, the numbers break down quite differently between various nation types as there is one researcher per $7.2 million in GDP for developed nations, and one per $237 million for less-developed nations. A $1 trillion increase in GDP in developed nations would lead to 138,000 new researchers, but only 4,200 researchers in less-developed nations.

Based on these numbers, there is increasing returns of researchers on GDP. As countries get richer, it actually takes less additional GDP growth to support another researcher. Growing the GDP of a rich country by $100 million would increase the number of researchers more than that same growth in a poor country. This is surprising to me as high tech jobs are outsourced to poorer countries because researchers there are willing to work for a lot less less money. I would have thought that increasing GDP by $100 million would allow for more researchers in poor countries, as they cost less to support. But, that is not the case.

Another implication of the increasing returns of researcher on GDP is it becomes a virtuous cycle where as countries get richer they can support more researchers for a smaller amount of GDP growth.

So, will increasing population lead to more researchers and quicker technological progress? Based on these numbers, the answer is a qualified yes. Even if all population growth were to occur in less-developed nations, there would still be an increase in the number of researchers. But, having nations get richer would lead to even more progress and it will be easier for nations (and the biological limits of the planet) to double their GDP than to double their populations.

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