The systems dynamics of endogenous population growth in a renewable resource-based growth model

This paper evaluates the dynamic effects of adding an endogenous process for human population growth into a renewable resource-based economic growth model. Endogenizing human population growth in a static, constant technology form of the model gives rise to a dynamically complex system, with the possibility of multiple steady states of several types, and unusual comparative static responses to changes in the system's parameters. Adding technological progress to the model gives rise to the possibility of multiple sustainable paths for the variables in the system. These results reinforce concerns raised by ecological economists about systems stability and sustainability, since exogenous shocks to the system could move the economy from higher welfare to lower welfare equilibria or, in the model with technological progress, from higher welfare to lower welfare sustainable growth paths. Moreover, this kind of dynamic complexity adds to the management challenge faced by policy makers, who could confront the necessity of maneuvering the economy among different equilibria or sustainable growth paths.