The Long Run Relationship between Population Growth and Economic Growth: a Panel Data Analysis of 30 of the most Populated Countries of the World
The aim of this study is to assess the controversial relationship between population growth and per capita income. The analysis is carried out on a sample of 30 countries. These countries are selected on the sole basis of their populations’ sizes. We selected a panel of 30 of the most populated countries of the world regardless of their levels of development. The Augmented Dickey Fuller test of stationarity was employed. The variables of interest turned-out to be I(1). We run the ECM,1 to test if there is a long run relationship between population growth and per capita income. The ECM result reveal that there is a long run equilibrium relationship between population growth and economic growth, and the granger causality test showed that there also exists a bi-directional causality between economic growth and population growth. We concluded by saying that population growth and economic growth are positively related.
Jel clasification: O47, O15, J11.