Demography, growth, income distribution and poverty: a survey of interrelationships

How will changes in population growth impact a countries’ growth potential? This paper reviews evidence concerning the link between population growth, economic growth, income distribution and poverty. These interrelationships are explored through both a macro- and micro- economic framework.

Key findings include:

• a positive and statistically significant relationship between demographic change and economic growth
• economic growth tends to be positively impacted by a rise in the economically active population, but negatively impacted by increases in the entire population
• an increase in the ratio of the adult working population relative to total working population is expected to result in a decline in inequality
• an increase in per capita expenditure reduces the depth of poverty
• a reduction in the Gini coefficient is expected to reduce the depth of poverty.

The author concludes that lacking micro-level data poses challenges for policy formation, as it is not based on systemic empirical evidence.