*Depopulation: An Investor’s Guide to Value in the Twenty-First Century*

That is the new eBook from my colleague Philip Auerswald and Anthony JoonKyoo Yun, you can buy it here.


Have you read it?

I think this is a very interesting topic, so I downloaded the book and read or skimmed most of it. Unfortunately I cannot recommend it, I don't feel like I learned anything.

Thanks for the feedback. I checked out your Twitter feed. Clearly you get the general message we aimed to convey. Fully agree with you on this point: "Given that the demographic transition is one of the biggest events of history, I'm surprised I don't hear more about it." This was really our motivation for putting together this short intro to the implications of global population decline. My Q for you: What did we leave out that you would have included? (... & what did we include that you would have left out?)

This is EXACTLY what I've been thinking about...I don't have a Kindle, wish I could buy a plain old book version.

The kindle app is free.

And there's a kindle app for your computer... so if you've navigated to the site, you're likely to be able to find it. In addition, many public libraries have e-readers for check out.

If you can't afford a Kindle should you really be reading?

I mostly read books on my iPad, but some people prefer reading physical books. It doesn't make sense to ignore or ridicule that audience.

Yep, I just like paper better. But don't worry, JAMRC is awesome, he can't possibly bother me. I'm just surprised he didn't say something more like "if we allowed in more immigrants there would be more labor available to print books for people like msgkings"

msgkings: @me on Twitter & I'll work on getting you a hard copy or PDF ... Anything for MR readers ;)

Have you read it? Is there a review? Maybe some highlights?

Lousy sales pitch, TC.

You need to be more Straussian.

Good read. Tx for the heads up.

What is with this continual separation of sentences by commas in Cowen's writing? We have three punctuation marks that will work just fine after "Yun," and one that is quite definitely wrong. He consistently keeps choosing the latter in cases like this. Why not start putting capital letters in the middle of sentences as well, or throwing periods in the middle of words?

I'm not worried about quantity, I'm worried about quality.

I'm on the first page and I already found an inaccuracy, they claim population is declining in Brazil and China. It's not.

@Clover--good spot about China, though with an older population it will also decline soon. I will skip this book, it seems too simplistic ('investors guide', lots of simple repetitive ideas), though this theory is persuasive since most of what people do is not Total Factor Productivity (TFP) enhancing. That is, the way society is set up, it rewards simple things like 'buy low, sell high' (middlemen) that is conducive to population growth, not increasing TFP. Another one is 'property rights', which favor rent seekers (that's how my family got into the 1%--DC real estate. And, btw, most of us were in the hard sciences and also made money that way, but not anywhere close to that of real estate from a growing DC area). Yet another is from rewarding doctors and lawyers, who essentially are middlemen, especially the latter, as doctors largely just keep old, unproductive people from dying and lawyers largely facilitate transactions or promote social justice (pie sharing vs pie enlarging).

Soapbox: how to increase TFP? Increase the value of intangibles like Intellectual Property (IP). It's something that government can do. Another is to increase the salaries of government boffins (UK word for scientists), which will trickle down to the private sector. Science does not pay, just read any blog about the brutal hours and low pay of post-docs in science. I could write a book on this. I have so much experience that nobody in academia has. Next time you read a wonkish paper on TFP or on 'how to improve' the economy, do a Control key plus F key and type 'patent' and hit Enter. You'll likely not get a single hit out of a 100 page paper, and if you do get a hit it will be an AlexT type cartoonish slam about patent trolls or copyright abuse, trivial stuff about the present system. Nuff said, off soapbox. Frankly, I don't give a dam since I've already made it. I will spread my genes, God willing, and continue to enjoy my life. I've already quit working. Fasten you society! LOL

"Yet another is from rewarding doctors and lawyers, who essentially are middlemen, especially the latter, as doctors largely just keep old, unproductive people from dying and lawyers largely facilitate transactions or promote social justice (pie sharing vs pie enlarging)."

Yeah, we should all go ahead and die sooner than we might otherwise given developing medical technology, in order to improve TFP on behalf of younger generations who should then proceed to die sooner on behalf of their progeny and so on.

The aforementioned nonsense masquerades as daring contrarianism but is one of the more fashionable opinions among the intelligentsia - that longer life expectancy is a problem rather than the greatest single triumph of modern civilization,

Oh man, did you just call Ray Lopez one of the intelligentsia? Dear god.

Ray - on science I assume you're referring to this recent piece about how a career in science will literally cost you your firstborn?


@Andrew M - yes, I saw this one! And there's others too. My family member had two degrees in science, published papers, cited, went to conferences, etc, and they dropped out of science to manage our real estate. Science is not worth it unless you are an immigrant and want an easy immigration visa to the USA, sad but true. I myself have a science background (several degrees) but made all of my money when working as a sort of manager of others if you will, rather than actually doing science.

Can't put a price on scholarship. But yes, I think most grad student applicants don't fully understand just how far behind your cohort you are when you start a career at 29 instead of 23. I have a very good friend who is 33 and has not had a "real" permanent job, just a string of postdocs and temporary positions. Quite prestigious institutions, and his work is surely more interesting than mine; but still.

"Next time you read a wonkish paper on TFP or on ‘how to improve’ the economy, do a Control key plus F key and type ‘patent’ and hit Enter."

You complain about the incomes of scientists compared to lawyers and then promote a system that enriches only patent lawyers. And that enrichment usually comes at the expense of engineers and scientists, especially at startups.

The Patent Appeals Board finds 70% of patents reviewed to have been issued in error through clever scams by patent lawyers. And those reviews come because innovative startups are being sued: most patent litigation victims are companies or individuals doing under US$10MM in business. Since patent litigation costs at least US$2MM, trolls see startups as easy victims that will pay anything to get out from under their attack.

It doesn't seem like a meaningful error. For all intents and purposes, the populations of Brazil and especially China are in decline. Grandma will hang on for another 20 years or so, but she can't make any more grandchildren.


It's a real thing, the entire world's population will be declining by the end of the century. It's pretty fascinating to consider how that will upend everything we 'know'. Again, Japan is the harbinger.

I'm not sure Japan is a harbinger since its immigration policies are quite different from other developed countries with more open immigration policies. 2 countries with low birthrates but with different immigration policies will have quite different outcomes.

Yes, that is the point. The trend is clear. Nearly every part of the world outside of Sub-Saharan Africa has either entered population decline or is close to doing so. While continued population growth in Sub-Saharan Africa may be sufficient to keep global population growing for multiple decades to come, most of the world will be contending with the consequences population decline throughout this century, absent open borders.

Open borders?!
There won't be enough immigrants to spread around.

Thanks for taking a look at the book. You are correct. We open the paragraph in question with fertility rate. Both Brazil and China are already at below replacement fertility levels, which we define as total fertility rate (children born/woman) or 2.1 or less: China's is 1.55; Brazil's is 1.79. Stats are at CIA World Factbook:
But the sentence to which you refer is, indeed, incorrect. While the trend in the population growth rate is negative for both Brazil, the most recent data the overall population growth rate still to be positive: 0.9% for Brazil and 0.5% for China. An earlier draft conveyed the intended meaning, which was that Brazil and China are already at below replacement rate fertility level. We will correct this sentence.

"Demographic transition" theory is garbage. The population of the US has not decreased, nor that of any of the other countries supposedly undergoing the “demographic transition”. The “demographic transition” is nothing but the replacement of some population by others — red in tooth and claw.

The so-called “demographic transition” is nothing more than replacement of the earlier developing populations by the later developing populations. This is because — in the context of the open borders/global labor arbitrage regime combined with birth control technology — the definition of “subsistence wages” no longer includes the high cost of child rearing in more developed nations. The demographic collapse of earlier developing populations is not having the upward pressure on wages among those populations that modern economists predict.

"red in tooth and claw"

How so this?

You keep using that term, "demographic transition." I do not think it means what you think it means.

"Demographic transition" is not so much a theory as it is a shorthand for communicating a widely (almost universally) observed empirical regularity: as countries became wealthier, fertility rates go down. Reasons for this are complex and not necessarily driven purely by market-based incentives. Visit Gapminder.org and review the relevant aggregate data.

The birth rates of members of "developing populations" plunge as soon as they arrive in the developed world and children become as much a financial liability to them as to their "developed" neighbours.

Go back to VDARE, mkay?

Even if migrant fertility plunges after migration, it would still be the case that the populations of developed countries would be replaced by the migrant population.

Female education and economic development are like antibiotics against human reproduction. But the fact that you’re successfully committing genocide against a huge portion of humanity blinds you to the fact that you’re also selecting for strains of humanity that will find ways of more efficiently turning wealth into an exponential growth of their babies. That optimum appears to involve lowering the age of female puberty and increasing the rate of de facto transfer payments to support their offspring. The idea that “property rights” or some such are the answer must take into account the political dynamics of the recent election as a warning: Liberal democracy has a very strong tendency to serve the most reproductive.

A female that pumps out 1 child a year from age 8 until age 38 has a 30 to 1 gain over those 38 years. That means an effective doubling time of under 4 years. Many of us may live to see this new breed of human become a dominant demography.

The “demographic transition” fantasy is like the fantasy that we can over-use antibiotics without developing resistant strains of highly virulent bacteria.

LOL...I'm a fan of novel ways to bottle the usual doomsaying.

What do you mean by doomsaying? Doom is subjective, no?

"successfully committing genocide"

Who is being massacred?

The unconceived. (I almost said "unborn", but that implies conceived but not born.)

Every condom is an instrument of mass murder and genocide. Obviously.

It's worse... at least using a condom is a conscious decision... what about all those teens who have wet dreams and wake up to realize they've had nocturnal emissions? Unintended genocide. The horror!

Every sperm is sacred http://youtu.be/fUspLVStPbk

So what does it say? Declining population should see land and real estate prices go down. Probably commodities as well. I'm not sure of the effect on bonds? I would expect stocks to go up as they only investment with a chance of a return. The time frame means its probably not relevant to me anyway as I would think its effect are still 100 years+ away.

I would say: "one-size-fits-all" consumer products will lose out against "niche market superstars" (for example McDonalds vs. Chipotle)?

I could see real estate in cities getting more expensive as the remains people leave the rural areas.

Demographers predict that in the second half of this century China's population will decline by about 400,000,000, more than the entire population of the US today. Think that might have economic and political consequences. [No, I haven't read this book, and I don't know what the authors say about China. What I've given is the mid-range estimate by demographers that 's been around awhile.]

Overall, very straightforward and easy for this non-economist to understand. Most of it makes sense to me. Some minor questions/quibbles:

* Are young people going to be valuable or not? In demand or not? Someone has to clean the bedpans and sing the old fogies to sleep. That goes against the 'needs more training to make significant contributions' point later in the book.

* I'd like to see a little more about the 'vertical changes' in population vs horizontal ones. The premier example is United States Jews, where the overall decline is being mitigated by the rapid growth of the fertile Orthodox subgroup. Liquidate your 'women's Talit,' and invest in Mechitzas. OK, that's a little too specific, but is there anything to be said about this type of demographic change for investors?

* I note that in portrayals of the Zombie apocalypse movies, scavenging skills are more valuable than money.

* somewhere it says 'mid 20th' century when the authors clearly mean 'mid 21st'.

Thanks for reading this through. Interesting comments. Agree that Mad Max is essentially applied industrial ecology. Likely to grow in importance in the future? I'd say quite likely.

Also appreciate your catching the typo.

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Phillip, I read the excerpt on Amazon and would love to buy a PDF copy of the book. Please email me when this is possible.

I would need to have a very good reason for reading a book that doesn't have a single Amazon review. A mention on MR isn't sufficient.

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