Population as a Human Resource

Older writing on population often treated it purely as a burden — more mouths to feed, more pressure on land and resources. Modern economics, and the AP Intermediate Economics syllabus with it, instead treats population as a resource with two sides: a quantitative side (how many people) and a qualitative side (how skilled, healthy and productive they are). The same number of people can be either a drag on growth or its biggest driver, depending almost entirely on the qualitative side.

Quantitative aspect — the sheer size and age-structure of the population: how many are of working age (roughly 15-64 years), how many are dependants (children and the elderly), and how fast the labour force itself is growing. A large working-age share, if productively employed, expands the economy's total output capacity.

Qualitative aspect — the skill, education, health and productivity of that same population. Two countries with identical population size can have vastly different economic outcomes if one has invested heavily in schooling, vocational training and public health, and the other has not. This qualitative dimension is what later sections of this chapter call human capital.

A useful, closely related measure is the dependency ratio, which shows how many non-working-age people (children and the elderly) each 100 working-age people must, in effect, support:

$\text{Dependency Ratio} = \frac{\text{Population (0–14 yrs)} + \text{Population (65+ yrs)}}{\text{Population (15–64 yrs)}} \times 100$ …