Lecture 7 - Julian Simon

Technological Change Theories of P & D

Author Information

  • Gobopamang Letamo, PhD

  • Professor in the Department of Population Studies

  • Faculty of Social Sciences, University of Botswana

Learning Objectives

  • Understand Julian Simon’s Argument regarding Population & Development.

  • Compare Simon’s theories with previous theorists.

Julian Simon (1932-1998) - Introduction

  • American economist, demographer, and statistician.

  • Professor at the University of Maryland, teaching Business Administration.

  • Focus on the economic effects of population changes.

  • Key works include "The Ultimate Resource" (1981) and a famous bet against Paul Ehrlich.

  • Opposed Ehrlich’s view that population growth leads to resource scarcity.

  • Proposed a bet on the future price of minerals, exemplifying his belief that ingenuity would prevent resource price increases.

Key Arguments of Julian Simon

Human Ingenuity as Resource

  • Believed human beings are capable of solving problems.

  • Argued the supply of natural resources is essentially infinite due to human innovation.

  • As resources become scarce, prices will rise, prompting technological advancements to:

    • Find more raw materials.

    • Extract more from known sources.

    • Discover alternative resources.

    • Develop societal structures to manage scarcity.

  • Emphasized that the main scarcity is human brain power, termed "The Ultimate Resource."

Population Perspectives

  • Viewed population growth as potentially beneficial rather than problematic.

  • Argued that each new person contributes economically in the long run.

  • Suggested societal investments in children might seem burdensome initially, but eventually yield economic benefits.

  • Quoted: "Minds matter economically as much as, or more than hands or mouths" (Simon, 1981).

  • Underlined the necessity of a conducive economic and political environment for population benefits to materialize.

Empirical Observations and Findings

  • Conducted extensive studies on health indicators, natural resources, and environmental quality.

  • Found a correlation between population growth and improvement in living standards.

  • Concluded that better living conditions can be expected to continue indefinitely if trends persist.

General Conclusions on Population Growth

  1. Stimulates innovation and development.

  2. Each individual represents potential for creativity and economics.

  3. Main issue identified as unfair global resource distribution, not population growth.

  4. Temporary scarcities lead to innovation and wealth creation.

Natural Resources

  • Not finite; costs can decrease as technology evolves.

  • Prices signify scarcity but must consider labor and capital requirements.

Agricultural Advances

  • Significant increase in food production post-World War II, challenging Malthusian predictions.

  • Green Revolution led to agricultural transformation via tech advancements in developing countries.

  • Noted disparities in food distribution caused more by politics than population.

Land and Water

  • Land is abundant but poorly managed.

  • Water scarcity can prompt innovation, like construction of new water sources and irrigation methods.

  • Urged for equitable resource distribution among populations.

Conclusion

  • Argues that life is improving with population growth.

  • Challenges in society are essential for progress.

  • Believes that human intelligence can ultimately resolve environmental challenges.