But the longer term social impact is a reduction in population growth.

The Case for Slowing Population Growth

Prevailing challenges include low growth, persistent poverty and weak governance, the social and economic disruption resulting from conflict and shortfalls in health and educational services.

In the long run, it is reasonable to expect that revenue growth would be broadly consistent with economic growth and, as it stands, there is little acceleration on this front. Earnings can grow faster than revenues for a prolonged (though not indefinite) period, if companies cut costs or reduce investment a trend that would, over time, lower depreciation charges.

But it is impeded by slow growth and, thanks to high unemployment and weak global demand, persistently low inflation. Worse, over the longer term, low investment undermines productivity, while protracted unemployment destroys skills.

The Long Mystery of Low Interest Rates

With high and volatile oil prices, businesses will focus their investments less on boosting productivity and more on maintaining flexible energy usage. At 40 a barrel, expect oil prices to slow the long run growth rate of the world's potential output by 0.1 per year.

We needed to reduce the population growth rate.

Back in the early 1990's, American officials like me who were making long term forecasts for the Clinton administration cautioned that it would be rash to forecast an average long run growth rate of more than 2.5 per year and that actual growth might turn out to be even slower. Now we look back at a decade during which the American economy has grown at an average rate of 3.4 per year.

The average geometric rate of annual population growth over the period of 1991 to 2000 was only 1.63 , one of the lowest ever registered.

On balance, then, the multispeed growth patterns of the past decade are likely to continue. Even as the developed economies experience an extended period of below trend growth, the emerging economies will remain an important growth engine.

Reducing individual tax rates and taxes on savings and investment at best fosters modest increases in employment, work effort, and income. Despite the Bush era tax cuts, the 2001 2007 expansion was the worst of the post war period in terms of investment, employment, wage, and GDP growth.

Gross domestic product growth, estimated at 3 per cent, remained positive for the second year running, though lower than in 2003.

While the earthquake and tsunami disaster lowered expected growth in 2005 somewhat in Thailand, Indonesia is still expecting GDP growth to increase next year.

According to the International Monetary Fund, during the first decade of this century, annual global growth averaged 3.7 , compared to 3.3 in the 1980s and 1990s. In the last four years, growth has averaged 3.4 .

In the context of implementing the Millennium Development Goals, poverty incidence should be reduced provided that favourable medium to long term economic growth is sufficiently broadly based to ensure that the poor benefit from such growth.

Nonetheless, Europe needs to be much more generous in permanently writing down debt and, even more urgently, in reducing short term repayment flows. The first is necessary to reduce long term uncertainty the second is essential to facilitate near term growth.

Excluding China, there was a general slowdown in growth of service imports by developing countries, mirroring a lower growth rate in their exports.

Telehealth could slow the rate of cost increases.

They are wrong, however, about Europe s prospects for achieving its restricted growth potential. Europe s actual economic growth has been quite good and thanks to low gas prices, low real interest rates, solid profits, and strong growth momentum promises to get better before the ceiling is hit and inflationary pressures set in.

The death isn't happening since we turned it off, we should have exponential growth.

More diversified economies are also likely to deliver more inclusive growth growth that creates jobs for more people, and that distributes its benefits more widely. In order to boost long term growth prospects and productivity, low income countries will also need to meet huge infrastructure needs, especially in the area of electricity generation and transportation.

The significant loss of current and future potential output is all the more remarkable, because it has occurred despite a sustained and unprecedented effort by the Fed to boost demand and hasten the recovery. Fed officials have repeatedly expressed concern that the prolonged weak recovery will inflict future pain in the form of slower long run growth.

Stagnating middle class wages and family incomes are a major factor behind the US economy s slow recovery from the 2007 2009 recession, and pose a serious threat to long term growth and competitiveness. Household consumption accounts for more than two thirds of aggregate demand, and consumption growth depends on income growth for the bottom 90 .

These changes do not directly induce economic growth, but they increase the economy s potential or long run income. Growth itself occurs as the economy begins to converge to this higher level of long run income.

After evaluating the technologies, policy options, and analysis included in the report, one might conclude that low carbon growth paths may be slightly flatter in the short term than their high carbon counterparts, with higher investment and lower consumption. Nonetheless, it would be difficult to deem them inferior, given their medium to long term advantages.

The Female Labour Force Participation while still quite low, is increasing. In 1981 it was 2.1 . It had moved up to 9.9 by 2001 2002.

First, they were trapped in a vicious circle of low income, low savings and low investment, leading to low productivity and low growth.

During this period, contributions to regular resources grew by 12 per cent, to other resources regular by 57 per cent and to other resources emergency by 63 per cent.

Second, persistent weakness in consumption and GDP growth puts the US economy on a much weaker growth trajectory than that which is built into the government s long term budget estimates. The Congressional Budget Office is assuming 3.4 average growth in real GDP over the 2013 to 2016 period.

In the last two years, credit grew almost twice as fast as GDP, and total social financing grew even faster. Yet GDP growth slowed considerably from an annual average of 10.2 in 2002 2011 suggesting that China may be moving closer to a medium to low speed growth path.

The projections for growth in regular resources are conservative and UNICEF hopes that actual growth will be higher.

Can China s government engineer a soft landing while weeding out corruption, reducing pollution, and liberalizing markets to ensure long term growth? The stakes are high.

Thus, the Japanese economy s potential annual growth rate slowed by roughly an additional two percentage points at the beginning of the 1990 s, as the post WWII development model lost its steam. It was largely a fluke that this growth slowdown coincided with an asset bubble collapse and a cyclical depression one that caused Japanese output to shrink by about 10 in a few short years, followed by only a slow recovery to the new, lower potential growth rate.

Among the consumer loans, medium and long term loans dominated by housing loans accounted for about 80 , but short term consumer loans grow faster than medium and long term loans.

Average annual growth rates for service exports of developed countries increased from 4 per cent during the period 1995 2000 to over 7 per cent during the period 2000 2003.

One popular line of thinking focuses on long term structural factors, such as demographic transition. But, so far, few studies have indicated that structural factors are adequate to explain the extent of the decline in China s potential growth rate over the last couple of years.

In the five years preceding the 2008 2009 crisis, the Indian economy grew at an average rate of nearly 9 annually. During the crisis, annual growth slowed, but only to 6.7 , reflecting the economy s inherent resilience.

As policymakers plan for the next five years, they should set China s growth targets at 7 7.5 , adjusting them within that range as changes in the international climate dictate. Such a growth target can help to stabilize employment, lower financial risk, and achieve the country s goal of doubling income by 2020.

Developing countries achieved an average real growth rate of 6.2 per cent, while annual growth among countries with economies in transition amounted to 7.1 per cent.

But the political reality is that China s government favors rapid growth in the short run over the structural reforms needed to sustain long term economic performance. Fiscal consolidation and the abrupt closure and restructuring of inefficient banks and state enterprises would, after all, constitute a powerful brake on short term growth, threatening social peace and political stability.

Some countries face the growing risk of near perpetual belt tightening, which would further dampen growth and thus keep debt ratios high. After all, if a country s debt GDP ratio is to decline without austerity, the interest rate that it pays on its debt must be lower than its GDP growth rate.

But, while the worldwide recession of 1981 2 brought inflation down rapidly, nominal long term interest rates did not fall immediately, for the world s markets were still not convinced. Hence, real long term rates remained quite high in the mid 1980 s.

The supposed evidence was wrong because 50 is the PMI s dividing line not between growth and recession, but between accelerating and slowing growth. Indeed, for 19 out of the PMI s 36 months of existence, the value has been below 50, while Chinese manufacturing growth has averaged 7.5 .

Another two fifths of the world population is already advanced on the path to lower population growth, but the remaining fifth is still growing very rapidly, largely because it has barely begun the transition to low fertility.