Impactof population growth on the PPC

Impact of Population Growth on PPC
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Impact of Population Growth on PPC
A Production Possibility Curve (PPC) or otherwise known as PPF (Production Possibility Frontier) is a curve that shows the maximum possible output an economy can achieve from producing a combination of two goods or services when all the resources are fully and efficiently utilized. Several factors such as the economic growth and population growth of a country affect the production of goods or services.
Impact of growth in the population on the production possibilities curve (PPC) and future economic growth
Based on an assumption that the growth in population, in this case, will also indicate a growth in the working population and that the resources available and technologies are fixed, this will mean that the economy will increase its potential output. Therefore the production of goods and services will increase the quantity and quality of resources will have been increased by the growing population (AmosWEB, 1).
How it might shift the PPC
As such, growth in the population will result in an outward shift of the production possibilities curve.
How are economic resources – their availability and employment- impacted by a growth in population?
Rapid growth in population will result in a decrease in the economic resources available for the country. It places a significant amount of pressure on the available economic resources, decreasing not only their availability but also their employment or utilization.

Essentially, as long as the population growth is lower than the per capita income of the economy, then the availability and employment of economic resources will rise, but if the growth exceeds the per capita income, then this will result to a decrease in the economic resources (AmosWEB, 1). For instance in developed economies, population growth may have a positive impact on the economic resources since additional people will increase the workforce for the production of goods and services. However, in developing economies, rapid growth in population would result in a decrease in economic resources since they will not be sufficient enough for the entire population.
Reference
AmosWEB. (n.d.). ECONOMIC GROWTH, PRODUCTION POSSIBILITIES. Retrieved May 9, 2018, from http://www.amosweb.com/cgi-bin/awb_nav.pl?s=wpd&c=dsp&k=economic+growth,+production+possibilities