An optimum population, Managerial Economics

Assignment Help:

An optimum Population

Countries are often described as under populated or overpopulated.  From the economist's viewpoint these terms do not refer to the population density (i.e. the number of persons per square kilometer), but to the relationship between the numbers of people and the supplies of land, capital and technical knowledge available to them.

"Under population" is an issue of concern because a thinly distributed population means relatively high transport costs.  This in turn has two effects.  First, trade and exchange are made more difficult; hence there is less specialization and more inclination to undertake subsistence production in agriculture and less specialized industry because of smaller market.  Secondly, the amount of social capital required per head of population is increased, so that it may not be worth building roads, dams, bridges or even schools and hospitals, or spending money on general administration for the small number of people in each area.

Excess or overpopulation may also make it extremely difficult for a country to "get started" on the path towards economic growth.  Because of excess population, there is poverty; because of poverty, people find if difficult to save and acquire capital equipment; therefore agriculture stagnates, education is limited, and health poor; the lack of capital and technical progress keeps incomes low, we thus have a 'vicious circle'.

It is therefore argued that if "under population" and "over population" can exist, somewhere in between there must be an "optimum" or best of population i.e. that size of population which with the existence stock of land, capital and knowledge, would give rise to the maximum output per capita are subject to constant change.  An increase in the national stock of capital, improvements in the techniques of production, and in the fertility of  land will all tend to increase the size of the optimum population.


Related Discussions:- An optimum population

Explain the laws of returns to scale, Laws of returns to scale alludes to t...

Laws of returns to scale alludes to the long-run analysis of the laws of production. In the long run, output can be increased by varying all factors. So in this section we study th

Advertising budget, Analyse The Method By Which a Firm Can Allocate The Giv...

Analyse The Method By Which a Firm Can Allocate The Given Advertising Budget Between Different Media Of Advertisement

Does capital inflow lower us interest rates, Basic textbook models, such as...

Basic textbook models, such as the Mundell-Fleming model, say that capital inflow happens due to the domestic interest rate being higher than the world interest rate, and therefore

Theories associated with different market structures, Theories associated w...

Theories associated with different market structures A firms profit maximising output decisions take into account the market structure under that they operate. There are 4 type

Least cost factor combination, Producers Equilibrium or Optimal Combination...

Producers Equilibrium or Optimal Combination of Inputs  The analysis of production function has demonstrated that alternative combinations of factors of production that are tech

Ramsey pricing, explain in detail ramsey pricing with example?

explain in detail ramsey pricing with example?

Determinants of price elasticity, Discuss the determinants of price elastic...

Discuss the determinants of price elasticity of demand

Presentation, to give presentation on the topic: shutdown and abandoned cos...

to give presentation on the topic: shutdown and abandoned cost analysis?

Explain about frequency domain, Q. Explain about Frequency domain? Fre...

Q. Explain about Frequency domain? Frequency domain:   Frequency domain is a term which is used to elucidate the domain for analysis of mathematical signals or functions with

What is demand theory, What is Demand theory: Demand theory relates to ...

What is Demand theory: Demand theory relates to the study of consumer behaviour. It addresses questions like what incites a consumer to buy a particular product, why do consume

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd