The Population Brain versus the Population’s Brains: How Entrepreneurs Confound Population Planning

Journal of Entrepreneurship and Public Policy

28 Pages Posted: 9 Nov 2022

See all articles by Peter Jacobsen

Peter Jacobsen

Ottawa University; Ottawa University - Gwartney Institute at Ottawa University

Abstract

The purpose of this paper is to examine the full opportunity cost of population policies by contrasting standard models of optimal population, which consider individuals to be homogeneous laborers, with a view that considers individuals’ capacity for entrepreneurship. This paper therefore examines this relationship between population and economic growth with entrepreneurship considered.
The paper draws on James Buchanan’s dichotomy of the organismic theory of government finance verses the individualistic theory and applies this dichotomy to population planning. This framework reveals entrepreneurial capacity is only compatible with the open-ended individualistic view. Lastly, the paper utilizes considers the number of potential entrepreneurs lost to China’s one child policy and considers the case of Jack Ma as a concrete example of the potential opportunity cost of policies which seek to curb population growth.

The analysis shows it is impossible for either natural scientists or economists to determine a welfare-enhancing population policy. Creative and entrepreneurial individuals contribute to the economy in ways not captured by standard models. The implication is policies seeking to curb population growth may inhibit economic growth by reducing potential entrepreneurs. Politicians cannot measure the opportunity cost of forgone entrepreneurs, and therefore the costs of such policies are unseen.

Keywords: Population, Public Choice, Market Process, Entrepreneurship, Economic Growth, Environmental Economics

JEL Classification: B53, L26, H11, O13, Q56

Suggested Citation

Jacobsen, Peter, The Population Brain versus the Population’s Brains: How Entrepreneurs Confound Population Planning. Journal of Entrepreneurship and Public Policy, Available at SSRN: https://ssrn.com/abstract=4262405

Peter Jacobsen (Contact Author)

Ottawa University ( email )

1001 S Cedar St
Ottawa, KS 66067
United States

Ottawa University - Gwartney Institute at Ottawa University ( email )

Ottawa, KS 66067
United States

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