Introduction: Living on a Shrinking Earth

A time when population growth was believed to be a disaster
Shrinking population, shrinking cities, shrinking pie
The world in 2050 will be worse than it is today.

Chapter 1: From Ancient Rome to 21st-Century South Korea: A History of Global Population Change

The Roman Empire, which declined from 1.1 million to 30,000 in eight centuries, and the Yuan Dynasty, which increased from 400,000 to 1 million in one century.
The industrialization of 19th-century Europe and the United States and the resulting population explosion
The collapse of manufacturing in 20th-century America led to the decline of cities and populations.
Western Europe's population peaks after World War II, and declines again.
In the late 20th century, Eastern Europe experienced a population decline unprecedented in world history.
Japan: Half of local governments will disappear by 2040; South Korea: Total population decline begins in 2020; China: Half of the population will disappear by 2100.
Countries whose populations are declining now will continue to decline in the future.

Chapter 2: The World Population Declines by 2070

Three stages of population change until the mid-20th century
Stage 4: Transition to a period of population decline. Once the birth rate falls, it is difficult to rise again.
1960s-70s: Population explosion, lower the birth rate!
China's one-child policy did not lead to a decline in the birth rate.
Have France and Singapore's birth-encouraging policies really worked?
A declining birth rate does not necessarily mean an immediate population decline.
Japan in the late 20th century was a "country of young people."
The inflection point where the world population begins to decline is 2070.

Chapter 3: Cities and the Economy Drive Populations

International Migration: 3 Factors That Make You Want to Leave Your Country of Origin
Domestic migration, even within a country, takes many forms.
Washington's population grew by 20% over 20 years, Beijing's population tripled over 30 years.
Mumbai's population, on the other hand, grew by only 1% over the past decade.
Eastern European population emigrating abroad: now only two women for every three men
Japanese and Russian populations moving from the periphery to the center
Japan, where population inflow occurred in only 7 out of 46 places
Russia's overall population has declined, but Moscow's population has increased by 40%.

Chapter 4: How Population Decline Affects Housing Demand

What are the direct consequences of population decline?
Why Are Wastelands Growing in America's Cities?
In Germany, housing demand is falling, but supply is increasing.
It's not population, but the number of households that determines housing demand.
In Eastern Europe, the population is decreasing, the number of households is decreasing, and the demand for housing is decreasing.
In Bulgaria, 27% of all housing units are vacant.
By 2050, the number of households in Poland will decrease by 2 million, and in Latvia by 200,000.
In Japan, one in seven homes will be vacant in 2018, and one in three homes will be vacant in 2040.

Chapter 5: How Does a Declining Population Affect Our Economic Lives?

Economic problems that arise when the age distribution shifts upward
A declining working population, resulting in a decline in consumption, and resulting economic decline.
When population declines, all investments and all markets shrink.
The stigma of being a place with a declining population
Population decline exacerbates inequality both between and within cities.
Tax revenues are declining faster than the population.
Why European Cities Are Better Off Than American Cities

Chapter 6: The Shrinking Nation, America!

By 2034, the U.S. population begins to decline.
America's shrinking workforce
Shrinking American Cities
Population fluctuates due to climate and prices
California recorded the largest net population outflow
Growth bias: shrinking cities receive a smaller share.
Efforts to cope with a shrinking future

Chapter 7: Three Major Challenges Facing a Shrinking World

The impact of climate change on countries around the world
Rising temperatures have unequal impacts.
Economic Winners and Losers from Climate Change
Can Technological Change Boost Productivity and Economic Growth?
Political instability and geopolitical risks threatening the world
Can the US, the EU, and China become future superpowers?
Countries trying to fill the void left by the great powers

Chapter 8: Growth is over, whether in population or economy!

Is population decline a sign of failure?
Population decline is not something to be solved, but rather something to be managed.
By 2050, global economic growth will turn negative.
Growth is over; we need to build a regionally centered economy.

Chapter 9: For a Sustainable City

The various situations that places with declining populations will face
Building a Strong Local Economy
Efforts to build a local community ecosystem

Chapter 10: 2050: Thriving in a Shrinking World

2050, the world to come
America's economic dominance will persist into 2050.
Obstacles to the transformation of shrinking cities
The Path to Success in a Shrinking World

Conclusion: The Age of Growth Ends, and the Age of Contraction Begins

References

On the Verge of Extinction, a world where everything is shrinking

Population decline has negative social, economic and environmental consequences.
Moreover, population decline cannot be separated from economic decline and poverty.
The United States, the European Union, and China, currently economic powerhouses, are also expected to experience negative population growth by 2050.
Judging by various evidences, economic growth is also likely to continue to slow, ultimately leading to the global economy not growing at all or experiencing negative growth.
As economic growth slows, the overall pie will shrink, as will cities, countries, and the world.
Humanity has now entered the “age of reduction,” a stage on the verge of extinction.

How does a declining population affect our lives?

In particular, the author focuses on how a shrinking population affects our social and economic lives.
We examine the ripple effects on our economic lives as the foundations of capitalism are shaken by the decline in housing demand caused by population decline and the resulting collapse of the housing market, the decline in consumption and productivity due to the decline in the working-age population and the increase in the aging population, the resulting deflation leading to a decrease in capital investment, the decline in the global economy and global trade, tax revenues declining faster than the population, and the lack of financial resources to support the aging population.


2070: Global population begins to decline / 2050: Global economic growth turns negative

The Institute for Health Metrics and Evaluation at the University of Washington, one of the world's most authoritative population forecasters, projects that by 2050, 65 countries, or a third of all countries, will have negative population growth, another fifth will have annual population growth rates below 0.5%, and that the global inflection point, where the total world population begins to decline, will arrive around 2070.


Moreover, global economic growth is projected to turn negative by 2050. Looking at the long-term global economic growth trend, measured by annual GDP growth rate, it has been on a steady decline since the 1960s.
Global economic growth is likely to decline further and eventually enter a decline in the coming decades.
As economic decline accelerates, global trade, which has been the foundation of global prosperity for decades, will also weaken.

The growing number of empty homes around the world stemming from population decline suggests an era of housing glut is upon us.

As the population declines, the number of vacant homes and abandoned land increases, eventually reaching a point where the real estate market virtually ceases to function.
Countries like Japan, where the number of vacant homes is expected to increase from 8 million today to 15-20 million by 2040; China, where a 2017 survey found that 65 million homes, or about 20% of the housing stock, were vacant; the United States, where even middle-class cities have seen a significant increase in vacant homes in recent decades, leading to a phenomenon called “urban wasteland”; Detroit, which has suffered a severe population decline due to the collapse of its manufacturing industry and demolished 20,000 vacant homes between 2014 and 2020; Latvia, where new residential building permits have fallen to just over 0.2% of all housing units over the past 12 years due to increasing vacancy; and Bulgaria, where 1,075,000 vacant homes, or 27% of all housing units, will be vacant in 2020, are all in serious trouble.

Population decline exacerbates spatial inequality.

Population decline exacerbates existing patterns of inequality and deepens “economic and spatial inequality.”
While it is clear that population decline leads to lower economic growth, the burden is not shared equally.
As population declines and resources become scarce, the pie shrinks, and the "growth bias" becomes even more pronounced as those with the greatest advantage hoard more and more of the available resources for themselves.
Ultimately, the growth opportunities available for future growth will also decrease, and competition to seize the “crumbs of growth” will become more intense.


Additionally, the population of areas with concentrated poverty is declining at a much faster rate.
In Cleveland, USA, the population of high-poverty areas decreased by 70% between 1970 and 2019, while the population of low-poverty areas decreased by only a third.
Washington, D.C., and Seattle, in particular, saw population growth of more than 20% from 2000 to 2020. In Washington, D.C., the number of residents with a bachelor's degree or higher more than doubled, and the share of the adult population with a degree increased from 39% to 59%.
In contrast, only 15% and 12% of adult residents in Detroit and Johnstown, respectively, which are experiencing population decline, have college degrees.


Population decline around the world, including the United States, China, Japan, Korea, Western Europe, Eastern Europe, Iran, and Russia.

The author vividly describes, with data, the social and economic changes in countries around the world due to population decline.
The countries covered in this book are:


In the 1950s, Japan was a “country of young people” where more than a third of the total population was under 15 years old and only 5% were over 65 years old. However, now 30% of the total population is over 65 years old. / China, where the population aged 20-29 has decreased by more than 40% in 35 years, increasing the median age from 37 to 49 years old, and the population will be half of the current population by 2100. / The United States, where the population will decrease by 2034 without immigration. / Korea, where the total population began to decrease in 2020 and is now at the forefront of shrinking countries along with Japan. / Russia, where the population decreased by 2 million over 30 years, but the population of Moscow increased by 40%. / Eastern Europe, where the population decreased by 20 million, an unprecedented decrease in world history since World War II. / Poland, where the number of households will decrease by 2 million by 2050. / Yorkshire, England, where 62% of the city budget was spent on welfare in 2018 due to the increase in the aging population. Barnsley, a small town; Eastern and Central Europe, which will see a 12% population decline between 2020 and 2050; Iran, where the total fertility rate fell from 5.07 in 1989 to 2.07 in 2000; Singapore, which has a National Night to encourage “adult men and women who are economically well-off and in stable, committed, long-term relationships” to have children, but recorded a total fertility rate of 1.1 in 2020; France, which spends 4% of its GDP on family allowances; and Sub-Saharan Africa, the only region on Earth with a growing population but no guarantee of economic growth.

Global total fertility rate: 4.98 in 1960, 3.71 in 1980, 2.41 in 2018

After World War II, as modernization and urbanization spread around the world, birth rates plummeted.
In 1960, the global total fertility rate was 4.98, dropping to 3.71 in 1980 and plummeting to 2.41 in 2018.
Total fertility rate refers to the number of children a woman is expected to have in her lifetime.
The replacement fertility rate, which refers to the level required for a population to remain stable in the long term, is 2.1 children per woman.
Sweden's total fertility rate, which had been around 4.0 in the late 19th century, fell to 3.6 in 1910, 3.2 in 1920, and below 2.0 in 1930, while Japan's total fertility rate remained below the replacement level for 45 years.
If a country's total fertility rate is higher than 2.1, the population increases; if it is lower than that, the population decreases.
A decline in the total fertility rate is a very important process leading to population decline.


In 1960, only five countries, including two former Soviet Union countries, had total fertility rates below the replacement rate of 2.1.
But in 2018, nearly half of the world's countries had total fertility rates below replacement level.
Of the 64 countries that recorded total fertility rates below replacement level in 2008, 63 countries, with the exception of one, still had total fertility rates below replacement level in 2018.

South Korea's total fertility rate of 0.7 is like the Black Death of the Middle Ages.

Ross Douthat, a columnist for the New York Times, introduced Korea's total fertility rate, which has fallen to 0.7, in his column dated December 2, 2023, and pointed out that Korea's population could decline at a faster rate than that of 14th-century medieval Europe, when the population plummeted due to the Black Death, and that "Korea is a prominent case study in the population decline problem faced by advanced countries."
Additionally, the Bank of Korea Economic Research Institute warned that the total fertility rate will fall to the 0.6 range in the fourth quarter of 2023, the growth rate will fall below 0% around 2050, and the total population will fall below 40 million by 2070.


The Power of Population: Population is closely linked to economic growth.

Population growth is not only a matter of economic growth, but also a deeply political issue, closely linked to perceptions of a nation's power and importance.
Population size has long influenced a country's standing on the world stage.
In the 1930s, this attitude gave rise to fears of population decline in countries like France and Britain.
This was because they were concerned that population decline could put them at a disadvantage in future economic and military competition.


Economists also say that the demographic dividend (the effect of a growing share of the working-age population reducing dependency ratios and boosting economic growth) has played a key role in the economic growth of countries like South Korea, Japan, and China over the past several decades.
However, as the population ages and life expectancy increases, the proportion of the working-age population decreases, and the population dividend effect also disappears.

The emergence of shrinking cities in the 1980s, the 21st century as a shrinking world

By the 1980s, as population decline became widespread in cities across Western Europe, two German scholars coined the term "shrinking city" to describe the phenomenon.
A shrinking city is a city that loses a significant portion of its population in a short period of time. With the emergence of shrinking cities due to population decline, and the subsequent increase in shrinking cities, the country itself is shrinking, and the 21st century is increasingly becoming a “shrinking world.”


Downsizing isn't just about changing numbers.
While the dynamics of shrinkage vary greatly from city to city and country to country, shrinkage causes significant social, economic, physical, and behavioral harm.
Such damage affects the vitality and resilience of countries and cities.
In the coming decades, shrinking cities will increase and "growth cities" will decrease.
With shrinking cities now becoming the norm, it is expected that by 2100, most cities around the world will be shrinking cities.

The shrinking status of populations around the world

Japan, in the mid-to-late 20th century, was a "country of youth."

Japan is currently one of the world's oldest countries, with about 30% of its population aged 65 or older.
But Japan in the 1950s was a country of young people.
From 1950 to 1990, the total population increased by 47% and the working-age population increased by 71%.
But by 2019, the situation had reversed, with those under 15 making up 12% of the total population and those over 65 making up 28%.
The working-age population has also decreased by more than 10 million since 1990, while the elderly population has increased by more than 21 million.
Today, one in seven Japanese workers is over 65 years old.
Currently, the median age in Japan is 〈56 years old〉.

The Japanese people's strong preference for "new homes," and the resulting vacant homes and housing market crisis.

In Japan, the preference for new homes is almost absolute.
If you can't afford a new home, don't buy one at all.
In the US, one new home is sold for every five old homes sold, and in the UK the ratio of old to new homes is 10:1, while in Japan the ratio is 1:2.
In other words, when two new houses are traded, only one old house is traded.
As a result, the number of new homes in Japan far exceeds the annual increase in the number of households.
In recent years, the number of households has increased by an average of 300,000 per year, but the number of houses built has increased by an average of 900,000 per year.
As a result, in 2018, one in seven houses or apartments, or a total of 8.2 million, were found to be vacant, and according to official projections, by 2040, the number of households in Japan will decrease by 3.4 million, and by 2040, nearly one in three houses could be vacant.


China's population aged 20-29 is expected to decline from 232 million to 135 million.

In China, in just 35 years from 2015 to 2050, the population aged 75 and over will increase from 50 million to 205 million, the population aged 20-64 will decrease by 180 million, and the proportion of the working-age population aged 20-30 will decrease from 47% to 42%.
In 2015, China's dependency ratio (the ratio of the working-age population defined as the population aged 20-64 to the dependent population, which refers to the population aged 65 or older and under 20) was 50 (2.0 working-age population per 1 dependent population), but it is projected that by 2050, the number of dependent populations per 100 working-age population will increase to 82 (1.2 working-age population per 1 dependent population).
Additionally, by 2050, China's population is expected to decrease by more than 10% compared to the current level, and the gender imbalance is expected to become increasingly serious as a result of the flawed one-child policy, emerging as a social problem.

In the US, healthcare spending for those aged 65 and older is projected to rise to 9% of GDP.

The U.S. population growth rate has been declining sharply since the mid-2010s.
“Simply put, too few people are born in America, too many are dying, and not enough people are immigrating.
America is entering a demographic danger zone.” In 2021, there will be over 4.7 million 30-year-olds, but only 3.5 million infants under the age of one.
By 2040, the number of college students is projected to decrease by at least 1 million, or 10%.
On the other hand, the population aged 65 and over, which was 56 million in 2020, is expected to increase to 84 million in 2050, accounting for 23% of the total population.
Five years from now, as the cohort entering the workforce begins to shrink, economic growth slows, and the dependency ratio increases due to an aging population, spending on health care for people aged 65 and older, which accounted for about a third of all health care spending in 2014, is projected to rise from 6% of GDP to 9% by 2030.


Nevertheless, the demographic factors that will make the United States an economic powerhouse by 2050

Regardless of political and social instability, the country that is expected to remain the most economically powerful in the coming decades is the United States.
Exports account for only 10% of U.S. GDP, a very small share of the U.S. economy compared to China's 19% and the European Union's 47%.
This characteristic of the United States is of great help as the wave of globalization gradually weakens, as the country has a domestic market with greater purchasing power than any other country.

But demographically, the United States has a greater advantage.
Comparing the birth rates of Germany, China, and the United States, Germany's birth rate has fallen below the replacement level since the late 1960s, while China's birth rate has remained low after a sharp decline from the 1960s to the 1990s.
However, the U.S. birth rate remained at or near replacement level until the Great Recession began in 2009.
Therefore, the U.S. population from 1991 to 2007 showed much more robust natural increase than China or Germany.
As a result, today in the United States, the proportion of the population aged 15-30 is much larger than in China or Germany.
Therefore, over the next 10-20 years, the U.S. workforce will decline less and the dependency ratio will rise more gradually than in other developed countries.
Because of these age distribution characteristics, the United States will have a clear economic advantage during this period.


South Korea leads the world in reducing its total fertility rate to 0.78 in 2022 and 0.68 in 2024.

From 2002 to 2019, 31 of South Korea's 85 cities experienced population declines, with half of them losing more than 10%.
Korea's population is increasingly concentrated around Seoul.
In other words, Seoul itself is no longer growing, but the surrounding cities are growing at a rapid pace.
The population of the satellite city of Incheon has increased by one million since 1992, and the populations of smaller cities such as Ansan and Uijeongbu have also doubled.
Meanwhile, in Busan, Korea's second largest city, the population decreased by 400,000 during the same period.


2050: Thriving without Growth on a Shrinking Earth

Living on a shrinking planet requires a different mindset than we've been accustomed to.
If population, GDP, and other growth trends were once considered the normal state of humankind in the 21st century, we must now accept that shrinking countries and cities are not a symbol of growth failure, but rather a reasonable path forward.
The impacts of population change are challenges to be addressed, not consequences.
Ultimately, it is up to us to determine what consequences this change will bring.
Unlike the frog in the boiling water, we will find a way out of the pot before it is too late.