ABSTRACT
The centerpiece of Knut Wicksell’s writings on population growth and poverty is diminishing returns. Had it not been for diminishing returns, the population problem would have been much easier to solve but, as diminishing returns prevail everywhere in the economy, there is an inexorable tendency for population growth to result in a reduction of per capita income and wages. Wicksell was completely convinced that these diminishing returns were strong enough to swamp the productivity-increasing effects of technological progress in the long run. Not only that, but in his Lectures in Political Economy he wrote (Wicksell, 1934: 214):
The unprecedented growth of the population recently witnessed in Europe, and still more in some extra-European countries, will certainly, sooner or later – probably in the course of the present century – prepare the way for much slower progress and possibly for completely stationary conditions.
