Must-Read: Dietrich Vollrath: Who are you calling Malthusian?

Must-Read: The word on what a “Malthusian” analysis of the pre-industrial agrarian-age economy means these days:

Dietrich Vollrath: Who are you calling Malthusian?: “Living standards are negatively related to the size of population…

…This would occur if we had some sort of fixed factor of production. Typically, one might say it was agricultural land, but you could just say resources if you like…. Population growth is positively related to living standards…. Then you’ve got what I’d call a Malthusian economy…. Everything in the system is pushing back towards some middle ground where the resource per person, and hence the living standard, is at just the right level so that population growth is zero. With no change in population, there is no change in living standards, so there is no change in population growth, so there is again no change in population. The economy becomes stagnant at the living standard which delivers zero population growth….

Let me offer a few [more] observations…. The stagnant level of living standards is not necessarily at a biological minimum…. All Malthusian economies do not stagnate at the same level of living standards. Shocks to technology/productivity will only temporarily raise living standards, but will permanently raise population size. Positive shocks to productivity raise living standards immediately for those alive, but this induces them to have more kids (or induces their kids to not die as quickly, so to speak), leading to population growth, which lowers living standards. Variation in productivity across countries will thus show up in higher population, but not necessarily in higher living standards…. The adjustment back to the stagnant level of living standards can take a long time….

What about other uses of the term Malthusian?… Brenner and Bois use the term Malthusian to describe their opponents and their theories. And to me, this is an incorrect use…. There is nothing Malthusian about Postan, Le Roy Ladurie, and North and Thomas, at least when it comes to their explanation of institutional change. This doesn’t make Brenner and Bois wrong. It makes them semantically confusing…. I don’t consider myself a Malthusian in this sense of… [a] finite limit of resources…. Technological change will make some resource constraints less binding…. The income elasticity of demand for resource-intense goods is low…. [Assuming] that no matter how high productivity got, we are always producing goods using the same resource-intense production function… may be fine if you are just describing the stagnant economies prior to sustained growth – or maybe it isn’t… if you read Lemin Wu’s paper – but breaks down if you allow for any appreciable non-resource based sector…