I have heard several times that countries in the west (especially in Europe) are dependent on a constant wave of immigration from the third world because of the low birthrate - That the capitalistic system demand a larger population growth than the birthrate can give in these countries.
So is economic growth and high living standard (modern capitalism) dependent on immigration ?
AFAIK, IANAE, It’s dependent on having a labor force being paid what the market equilibrium demands. If your local economy is full up on service and professional jobs with a need for lower skilled, much lower wage labor that you cannot fill with local workers, it creates a vacuum that immigrants (persons that WILL accept lower wages) fill nicely. It works out great - immigrants get jobs, things get made/done cheaper, and we all win with better living standards and higher growth.
Also true for specialized occupations in engineering and IT that are certainly high wage, but the local market may not have enough local workers with the proper skills.
Japan has both a low birth rate and very little immigration, but seems to be doing fine economically. They are investing heavily in robotics & automation to handle the lower end jobs, rather than importing third-worlders. This honestly seems like a better solution in the long run, since the world’s population can’t keep increasing forever, and it avoids the negatives like crime or cultural disagreements that crop up with immigration.
And I know that when I get old and decrepit, I would rather have an impersonal robot taking care of me than a human, as being in such a vulnerable state to another person would be quite embarrassing, while having a tool to help me out would be less so. Same reason why I would rather have a wheelchair if I couldn’t walk, rather than having someone carry me around.
South Korea and Finland would be two other countries with healthy economies that don’t really have much immigration.
It worries me that the rich countries make less kids than the poor countries and the rich people make less kids than the poor.
In capitalism, the rich is the productive. With the productive shifting out of the gene pool there will be no end to world’s problem.
Why not legalize prostitution and polygamy? Then all rich males can make thousands of kids as long as they can afford it. I am sure there will be enough consenting women.
Otherwise, those women, cannot pick the rich and pick some poor males that requires welfare check.
There is a good explanation for this. In an agrarian society, having many kids creates wealth for the family, as children provide valuable labor in the field and the home. Children also act as your retirement account. Finally, in areas with high child mortality rates people are likely to have more children to make sure at least some survive to adulthood.
In urban, industrialized societies, having children is an economic burden on a family. They cost a lot of money and do not contribute to the family’s wealth. So there is a big incentive to just have one or two children and invest everything in them.
“Is our children learning?”
Yes, I can see that Paris Hilton is productive.
Please tell me that you aren’t uggetsing that being rich is genetic.
You are aware that, right now, it is legal for a man to father children by women to whom he is neither married nor in a commercial contract with. Right?
This makes no sense at all. I dont think you understand at all why rich people choose to have fewer children. It isn’t a lack of partners I can assure you of that.
I’m predicting affluent nations will return to this strategy in our lifetimes. With the elderly population constantly expanding while the youngest segment simultaneously shrinks, who is going to pay our pensions 60 years from now, and with what money? Who is going to take care of us and at what cost? One of the reasons I have children is just this. I live in one of the most affluent Western countries in the world.
I was going to post something just like this. As long as capital is flowing in an economy and wealth is being created, more people – regardless if they are immigrants or naturally born, or pulled from the unemployable – will increase economic growth.
More people means a greater labor pool. An increase in the supply of labor will drive down wages. The more skill needed at a certain position (though this is somewhat true of all positions), the stickier the wage. So low wage positions will have the most variance. With labor costs decreasing, more and more capital can be used to acquire other resources or create more value in the production, which ultimately leads to more wealth.
More people also mean a larger market to sell to. Specialized goods (i.e. goods that require specialized production: highly skilled labor, technical machines, etc.) will start to get automated and new markets will be created. This means lower prices and manufacturers create more goods to enter the market. The higher supply of goods and services, the lower that those will cost, thus freeing up capital to R&D and increased production.
This is best illustrated by high tech goods and services, e.g. the cell phone. When I first started working, only equity partners at my firm would have cell phones. Those were big and bulky and one had to carry a small suitcase for the battery. When I went in-house, all workers were given cell phones or blackberries. Prices for phone use dropped dramatically. Flash forward to today and I got work to buy me an iPhone and I can literally work most days without turning on my computer, from anywhere with a 3G connection (I find the Edge network to be unbearable, but I’m spoiled like that). Phone plans can be ridiculously cheap, and often people forgo a regular house phone for the convenience and flexibility of a cell phone. My little sister used to do $100 prepaid @ $0.10/min before she got a job and a company cell phone.
Since most public retiree benefits are paid out of current taxes, an aging society with low immigration could have trouble with economic growth. As the worker/retiree ratio changes in order to maintain benefits taxes have to go higher. This can slow economic growth if the marginal rates are high enough due to deadweight loss. The income effect can also cause slower growth although this could be mitigated by substitution effects depending on where the rates are, and worker preferences. If the worker/retiree ration got low enough and the tax rates high enough a country could find itself on the wrong side of the Laffer curve with very bad implications for economic growth.
Japan is a special case. It can afford to import a huge amount of food and base materials without messing with its foreign exchange reserves too much because it exports a lot of stuff (read: consumer electronics and cars).
Sustainability aside, this means Japan doesn’t need millions of low-wage workers to keep food prices down. Building robots to attach transistors and paint auto bodies is much easier (and more cost-effective) than building robots to pick oranges.
While the latter problem (better phrased as “educated people have fewer children”) is real, the first problem isn’t. Wealthy countries attract the well-to-do and educated people from poor countries. For example, 67% of Indian immigrants to the US possess a bachelor’s or degree or higher, compared to 28% of the general US population.