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Population and Economic Growth: A Critical Note

The Review of Economics and Statistics 1981 63(1), 149
A critique of the analyses and conclusions reached by a study of the relationships between economic and demographic variables conducted by Hazledine and Moreland published in 1977 is presented. Inappropriate analyses of cross-sectional data from 82 countries resulted in parametric estimates that did not justify the conclusions reached by Hazledine and Moreland. Concerning diminished returns to scale suffered by less developed regions the author found on reexamination the scale estimates to differ only slightly across regions and also the parameter reflecting returns to scale with respect to labor and capital to produce erroneous estimates for developed countries. The reported significant positive relationship between infant mortality and birth rate is not justified for low income countries because the mortality variable had been dropped from 2 of the 3 fertility regressions for low income regions. The relationship specified therefore holds only for Asia. The large differences across regions in savings behavior is a questionable finding for several reasons including the inappropriate comparisons across regions of estimated coefficients drawn from differently specified equations. In addition various extrapolations and simulations were found to be useless because of instabilities in and poor predictive capability of the underlying estimates.