Infernal Ramblings
A Malaysian Perspective on Politics, Society and Economics

Malaysian Demographics: Ridiculous Population Growth

Written by johnleemk on 4:08:26 pm Jul 1, 2007.
Categories: ,

One amazing thing about Malaysia is how until recently, our government was fixated on growing our population without consideration for the effects of this policy.

Before Mahathir Mohamad's tenure as Prime Minister, family planning had been on the table as a government policy. Tan Siew Sin, former Finance Minister, and his wife were strong proponents of family planning, and actual allocations for the purpose of contraception were made in some of our five-year economic plans.

Then, along came Mahathir, who had this marvelous insight. The United Kingdom has a larger population than Malaysia, right?

Well, the UK apparently has a smaller land mass than Malaysia. Conclusion? We need a larger population than the UK — perhaps one as large as a hundred million.

Mahathir's rationale was that a larger base of consumers and employees was necessary for the country to advance industrially. Screw birth control — what we need is to reproduce like rabbits!

Of course, as other developing countries have discovered, growing the economy and improving the living standards of your citizens are rather difficult to do, because your economic growth must outpace your population growth.

This is why most developed countries have very low birth rates but very high standards of living. They often do the smart thing and tap into immigration, to the point where countries like the United States actually defy traditional demographic population models.

Mahathir must have missed an education in one fundamental economic principle: diminishing marginal returns. When you increase one input without increasing other inputs, you will not gain as much output as you might otherwise would.

When you increase the population without, say, improving the education system, you are not going to get as much out of your next millionth citizen as you do out of your next hundredth citizen. It's mathematically proven, and this theory turns out to work pretty well in the real world as well.

Growing the country's population at a huge rate is thus a bad idea, because the gain each new citizen adds to the economy will diminish, to the point where they become a net loss.

Unfortunately, thanks to Mahathir's policy, our population continues to grow — it stood at 27 million at the last estimate.

It is true that our resources will be underutilised because we don't have as large a population as we might ought to have in the present. But slow and steady wins the race.

If we upgrade our population's size without upgrading the facilities required to make them more productive, we will only end up creating a burden on the economy. Our policies must be adjusted to encourage family planning, rather than unthinking reproduction.


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