The Malthusian Trap – How an again and again refuted theory from over 200 years ago still haunts us

Looking at today’s discussions about the scarcity of resources, climate change, or economic growth, a recurrent pattern of argumentation reveals itself: “Today’s social and economic system requires constant growth. And in a finite world that’s just not possible.” The intellectual great-grandfather of this position was the British economist Thomas Robert Malthus, who in 1798 (in “An Essay on the Principle of Population”) and subsequently in 1820 (in “Principles of Economics”) compared the principle of our resources’ finiteness to the dynamics of human population growth (the underlying argument, however, we already find in Aristotle’s thinking). Formulated into a mathematical law, Malthus posed it as an inescapable necessity for man to fatefully obey a law of unlimited multiplication, while the resources needed for such “geometric” (“exponential”) growth of mankind do not grow in the same proportions. These develop only “arithmetically” (“linearly”). According to Malthus, such an unrestricted increase means that at some point the available food is no longer sufficient to feed the earth’s population, so that frequently corrective events in the form of illnesses, misery, wars, and death must occur that limit the growth of the human population and thus maintain the necessary balance. That he used an economic and sociological theory as a basis for concrete moral judgments, to the effect that poor people are starving and dying for a good reason, has repeatedly brought him strong criticism, so that today he finds himself placed in the line of anti-humanistic thinkers (who at his time, however, had significant political influence: his overpopulation theory led to the “Poor Law Amendment Act” in England of1834, in which the support of those in need in England experienced massive cuts). Specifically, Malthus meant: A penniless man whose work society does not need has not the slightest right to demand any part of food, and he is really too much on earth. Although this well-known and notorious statement has later been canceled by Malthus himself, it sums up his thinking quite well.

This does not deter many economists, sociologists, or other politically motivated people from applying the Malthusian pattern of argumentation to modern times.Whether the Club of Rome sets the limits of growth and lent some green paint to Malthusian theory in 1972, environmental economists use the argument of the finite nature of our environmental resources in their demandfor radical political reversals, otherwise mankind would experience its ultimate demise;opponents of capitalism generally denounce economic (exponential) growth which, because of the finiteness of material goods on our planet, cannot be sustainable; money theorists demand the introduction of sovereign money, i.e.a limitation on the banks’ ability to create money (that is what a soon coming plebiscite in Switzerland is about); or violent researchers warn of armies of “surplus” young men – in all these resonates the gloomy, pessimistic tone of Malthus. In the central passage of the Club of Rome report, in almost Malthusian words it says: “If the present growth trends in world population, industrialization, pollution, food production, and resource depletion continue unchanged, the limits to growth on this planet will be reached sometime within the next one hundred years.”

There is hardly any theory in the history of political economy which has been more clearly refuted by the actual development than the Malthusian one. Since 1800, the earth’s population has increased eightfoldfrom less than one billion people to currently more than 7.5 billion. At the same time, the share of starving people worldwide has dropped to just over 10%. For comparison, the proportion of those in danger of starvation in 1800 was over 90% (in 1800, 95% had to live with less than the equivalent of $2 in 1985 prices). Today,hunger across broader parts of the population is limited almost exclusively to the African continent. And here its causes are rarely that there is too little food available, but rather various social, political and economic factors that result in food not reaching those in need of it.

So what led to Malthus being so far off the mark with his theory? The answer can be briefly expressed in two words: technological progress. Malthus based his claims on a (rather thin) empirical foundationof an agrarian society, which already in England of his time had begun to give way to the Industrial Revolution. He considered the state of technology of his time and took this as the basis for all future technologies – a mistake still prevalent today in economic and social research. However, with advances in the breeding of seed, nutrient replenishment of soils (e.g. chemical fertilizers), irrigation, mechanization, and numerous other inventions, the growth of food supply in the ensuing 200 years has been dwindling. Concrete examples were: the discovery of the plant growth-promoting effect of nitrogen, phosphates and potassium by the chemist Justus von Liebig in 1840; the catalytic ammonia synthesis developed in 1908 by the chemist Fritz Haber, which the industrialist Carl Bosch developed into a process that enabled the mass production of ammonia thus creating the basis for the production of synthetic nitrogen fertilizer; and not least the development in the 1960s known today as the “Green Revolution”, which refers to the introduction of modern agricultural high-yielding varieties and their successful use in developing countries. And today, based on genetic engineering, a new agrarian revolution has started, even though we do not like to hear about it.

The failure of Malthus’s argument always follows the same pattern: the prevailing level of technological development and the given social structure are projected into the future (respectively, extrapolated only with linear growth rates), which, given the exponential growth of our resource consumption, yields catastrophic effects and a dystopian future. In reality, however, technological advances have been much faster than any linear growth during much of the last 400 years. Even exponential growth rates were at times exceeded as scientific and technological leaps jumpstarted new social and economic developments(e.g. the Haber-Bosch process allowed more or less instantly a multiplication of agricultural yields which in turn fed much more people).

Social innovationalso play an important role. And they often interact with the technological change. Examples are the triumphal success story of the birth control pill, China’s one-child policy (which is in line with Malthusian thinking), or the sharp decline in birth rates in developed countries caused by growing prosperity and women’s emancipation (resulting in a social and economic problem which is exactly the opposite of the Malthus scenario: due to low birth rates,the population is shrinking in many industrialized countries).

The scientific-technological and economic, respectively social progress defused the Malthusian trap, and this over and over again. Nevertheless, it is not easy for us to rely on this in the future. Because upon closer inspection, the growth of our knowledge and our abilities has not always been solely about sustainably generating more output with the same input, but all too often about depleting existing resources of our planet, i.e.achieving more output with more input. The first two industrial revolutions were based on the less sustainable burning of fossil fuels, i.e. coal, later oil, and gas, with which mankind used geological deposits of old solar energy stored as carbohydrates which are finite in their availability – and whose combustion has a massive impact on the global eco-balance. Specifically, we have learned to dig deeper for minerals, to fish in the oceans with larger nets, and to cut down forests with more efficient deforestation equipment. So we not only get “more for less”, but also “more for more”. Some of what we call “technological value added” is in the sense of economic value creation on the global balance sheet rather a reduction of existing assets than the creation of new equity.

The discussion about resource scarcity and climate change therefore often comes with a call for an end to economic growth. With that, the intellectual heirs of Malthus strip off the blemish of the anti-social and dress themselves in a much more congenial green robe. It is now no longer the finiteness of food availability, but the environmental sustainability of our modern way of life, which is called into question, and from which similar collapse scenarios to those from over 200 years agoare articulated. And indeed, the material and ecological resources on our planet are finite, and an exponential growth rate of any consumption of theirs must therefore eventually reach its limits. In this point, we are forced agree with the modern Malthusians. What is unlimited, however, and has remained largely disregarded in the philosophical and economic accounts since Aristotle, is the human spirit of invention and entrepreneurship. Unlike the physical world our scientific and technological as well as social and economic creativity knows no limits of growth! Inventions, new technologies, and social progress again and again exceed the framework of past imagination and have proven to bring us much further than our ancestors had ever dreamt.

Nevertheless, the question remains: Could Malthus’s argumentation apply this time? Or can with the help of our increasing knowledge and future technologies human prosperity and its constant increase be reconciled with a stopping of global warming and the finiteness of earthly resources? If we disqualify the modern Malthusians due to historical shortcomings of their dystopian visions of the future, we bet on the inexhaustible inventiveness of humanity. Again: So far we have won this bet over and over again. The anti-humanist core of Malthus’s doctrine that man lies at the origin of man’s demise has been disproven every time until today. The question is, however: Do we really want to rely on this continuing to hold up going forward? Nothing less is at stake than the future of the human civilization itself.