Malthusian Growth Model
Why living standards were flat for millennia: population growth eating every productivity gain.
The Malthusian Growth Model model, in writing
Definition
The pre-industrial growth trap: population grows whenever income exceeds subsistence, but land is fixed, so any productivity gain is eventually eaten by more mouths and living standards return to subsistence.
Income per head falls as population rises (diminishing returns to fixed land); population growth ∝ income − subsistence
The intuition
For most of human history the model was right: better harvests meant more surviving children, which diluted the gain within a generation or two. The Industrial Revolution broke the trap when technology started improving faster than population could respond, and the demographic transition then severed the income-fertility link entirely.
Exam tip
Malthus is a model of the LEVEL of living standards, not growth: technology shifts income up temporarily, population growth drags it back. Explain why it stopped applying after ~1800 for full marks.
Related models in Advanced Macro & Growth