Growth Economics Assumed a Growing Population. That Assumption Is Ending.

Modern growth economics was largely built during a historically unusual window: population growing, workforces expanding, consumption bases widening almost everywhere. Models calibrated to that window quietly assume it continues, because for most of the twentieth century, it did. That assumption is now breaking in a growing list of major economies simultaneously.

A shrinking, aging population doesn't just slow growth — it changes which growth levers even work. Consumption-led strategies get harder when the consumer base is flat or falling. Productivity gains have to do more work per capita just to keep the economy standing still, let alone growing.

The economies that adapt well won't be the ones that find a way to reverse demographic trends — that's largely not on the table on any relevant timeline. They'll be the ones that stop optimizing policy around a growth assumption that no longer holds, and start optimizing for prosperity in a world where the population curve has already turned.