PAUL A. BORG B.A. (Hons) Econ., Dip. Lab. Stud.

Economics Course
Unit 3: Population
Text (2010 Ed.)

3.1 The effects of changes in birth rate, death rate and migration on a population
3.2 Population pyramids
3.3 Optimum population
3.4 Increasing Population and Ageing Population
3.5 Population distributions
3.6 Summary of Formulae used in this Unit

This Unit covers the following parts of the SEC 10 syllabus (2010):
14.1 The main determinants in size and composition of a country’s population
Candidates should be able to
 explain the effects of changes in birth rate, death rate and migration on a
population;
 interpret population pyramids;
 explain the importance of education and health on a country’s population.
14.2 The main determinants in size and composition of a country’s population
Candidates should be able to:
 identify the main trends in the size, sex, age, occupational and geographical
distribution;
 assess the causes and consequences of these trends;
 understand the effects of government policy on the occupational and
geographical distribution of population.

3.1 The effects of changes in birth rate, death rate and migration on a population
Changes in the population of a country come about in two ways:
(i) by movements in birth and death rates: the crude birth rate (BR) is usually expressed as the
number of births per annum per thousand of the population and the crude death rate (DR) is the
number of deaths per thousand of the population per annum; the natural growth rate (NGR) is
the difference between these two rates. Thus NGR = BR - DR. The symbol for per thousand is ‰.
(ii) by migration: migration means the movement of people from one country (or area) to
another; from Malta’s point of view, immigration occurs when foreigners come to Malta to live
and work here, whilst emigration occurs when Maltese people go to live and work abroad; the
immigration rate (IR) is the number of immigrants per thousand of the population per annum
whilst the emigration rate (ER) is the number of emigrants per thousand of the population per
annum; the migration rate (MR) is the difference between the Immigration rate and the
Emigration rate. Thus MR = IR - ER. It should be noted that migration is a cause of changes in a
country’s population but may not be cited as a cause of changes in the world’s population unless
we discover extra-terrestrials!
An algebraic analysis of the above equations shows that NGR=0, when BR=DR. Likewise, MR=0
when IR=ER. NGR>0 (positive) when BR>DR and likewise MR>0 when IR>ER. NGR<0
(negative) when BR<DR and MR<0 when IR<ER.
Changes in the population of a country are thus explained by taking together the Natural Growth
Rate and the Migration Rate. It should be obvious that if both NGR and MR are positive then it
means that the size of the population is increasing. Two other possibilities for an increasing
population are:
NGR>0 and MR<0 but NGR > -(MR), i.e. the positive NGR outweighs the negative MR;
NGR<0 and MR>0 but -(NGR) < MR, the positive MR outweighs the negative NGR.

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Thus an increase in the birth rate does not necessarily mean that the population of a country is
increasing since this also depends on changes in the death rate and the two migration rates.
Likewise an increase in the death rate does not necessarily mean that the population decreased.
In 1976, Malta’s population was 319,985 at the beginning of the year. This increased by 2,871 due
to natural factors and decreased by 740 due to migration. At the end of that year, therefore, the
population stood at 322,016. This shows that the MR was negative (-2.3‰) and served to offset
some of the increase in population due to a positive NGR (9‰). The increase in population was
thus 6.7‰p.a.
In 2006, population was 405,006 at the beginning of the year. This increased by 669 due to natural
factors and increased by 2,135 due to migration. At the end of that year, therefore, the population
stood at 407,810. Thus, thirty years on from 1976, Malta now has a positive MR (5.3‰) and a
positive NGR (1.7‰). The increase in population was thus 7‰p.a.
For 1976, the birth rate for the Maltese population was 19 ‰ with the greatest number of births for
the 25 to 29 age group of mothers. The death rate was 9.8 ‰. This gives a NGR of 19 – 9.8 = 9.2,
i.e. Malta’s population was increasing by 92 persons for every 10,000 persons due only to natural
factors, i.e. not due to migration. The infant mortality rate (deaths under 1 year) was 15 per one
thousand live births.
For 2006 the birth rate was 9.6 ‰ with the greatest number of births also for the 25 to 29 age
group of mothers. The death rate was 7.9‰. This gives a NGR of 9.6 – 7.9 = 1.7, i.e. Malta’s
population was increasing by 17 persons for every 10,000 persons due only to natural factors, i.e.
not due to migration. The infant mortality rate was 3.6 per one thousand live births.
The above information as well as other information on population is available from the website of
the National Statistics Office (NSO) - www.nso.gov.mt. The information regarding population is
best found in the publication Demographic Review.

3.2 Population pyramids

The age distribution (or age composition) of the population refers to the numbers of people in the
different age groups. The most popular way of presenting this information is in the form of a bar
graph, where the length of each bar indicates the number of people in that particular age group.
Such bar graphs are called population pyramids. The two main types of these bar charts or
pyramids are the Normal Population Pyramid (Fig. 3.1) and the Ageing Population Pyramid (Fig.
3.2).

Fig 3.1: A Normal Population Pyramid

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Fig 3.2: An Ageing Population Pyramid

Fig. 3.1 shows a country with a normal population pyramid. This is a country with a high birth rate
and a high death rate. It will have a large proportion of young people in its population. The
expectancy of life will be relatively low because the death rate will be high in all the age groups
and only a small percentage of those born in such a country will reach the older age groups. This
population pyramid is typical of most developing countries. In countries with this type of age
distribution, between 40% and 45% of the population will be below the age of 15 years and only
about 4% will be older than 60 years.
Fig. 3.2 shows a country with an ageing population pyramid. This is a country with a low birth rate
and a low death rate, indicating a stationary population. The expectancy of life is high and most
people survive into the older age groups. This population pyramid is typical of most developed
countries. The percentage of young people in such a society is typically between 20% and 25%;
about 15% of the population will be over 60 years of age.
Life expectancy is the average number of years that a person can be expected to live, assuming
that mortality levels remain constant. In this regard, one must also look at the importance of
health on a country’s population. Thus, on the one hand, Switzerland boasts of 1.5 practising
doctors per 1,000 population and has a life expectancy of 72 years. On the other hand, Turkey has
only 0.3 practising doctors per 1,000 population and has a life expectancy of 48 years
(www.oecd.org). Thus high levels of expenditure on health are one of the important factors in
bringing about an ageing population.
The economist is interested in the age distribution of a population to calculate the Dependency
Ratio, which reveals the proportions between the numbers in the working age groups (the working
population) and the numbers in the non-working age-groups (the dependent population) and is
found by using the formula:
Numbers below school leaving age + Numbers over retirement ages
Numbers between school leaving age and retirement ages
When DR = 1, this means that for every one person who is too young or too old to work, there is
only one person who is of working age. The DR of developing (poorer) countries is typically euql
to 1. Developed (richer) countries, on the other hand, tend to have a DR of 0.5, i.e. for each person
who is too young or too old to work, there are two people of working age.
The total population (TP) may be classified into working population (WP) and dependent
population (DP), i.e. TP = WP + DP. The working population consists of those between the
Minimum School-Leaving Age (MSLA) and the Retirement Age (RA). The dependent population
consists of those below the MSLA and those above the RA. The formula for the dependency ratio
may be restated as DP/WP.

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The minimum school-leaving age in Malta is 16 although about 50% of secondary school leavers
continue their schooling at post-secondary level. The pensionable age is 60 for females and 61 for
males, although some sections (notably those in the Police force) may retire earlier due to their
number of working years. Thus, on average, the WP for Malta consists in those between 16 and 60
years of age whilst the DP consists of those below 16 and those above 60 years of age.
Table 3.1 below shows the distribution of the population by sex and age for 1976 and 2006.

000’s 1976 2006

Ages Males Females Total Males Females Total
0–4 13.9 12.8 26.7 9.8 9.3 19.1
5–9 12.1 11.2 23.3 11.1 10.6 21.7
10 -14 13.3 12.5 25.8 13.2 12.4 25.6
15 - 19 16.2 15.7 31.9 14.4 13.8 28.2
20 - 24 14.2 14.4 28.6 14.8 14.0 28.8
25 - 29 13.9 14.8 28.7 14.9 13.9 28.8
30 - 34 10.4 12.1 22.5 14.0 13.3 27.3
35 - 39 7.9 9.7 17.6 12.1 11.6 23.7
40 - 44 7.6 9.3 16.9 13.0 12.5 25.5
45 - 49 7.3 9.2 16.5 14.7 14.6 29.3
50 - 54 7.4 8.2 15.6 14.2 14.0 28.2
55 - 59 6.4 7.3 13.7 14.8 14.9 29.7
60+ 16.4 20.8 37.2 34.4 43.6 78.0
Total 147.0 158.0 305.0 195.4 198.5 393.9
Source: Demographic Review, 1976, 2006 (NSO)
Table 3.1: Age and sex distribution of Malta’s population for 1976 & 2006
If we consider the school-leaving age to be 19 and the retirement age to be 60, we calculate the DP
by adding the numbers in the first four age brackets and the number of the 60+ age bracket. For
1976, this amounts to 144,900 whilst in 2006 the number is 172,600. The WP is calculated by
adding the eight age brackets in between or by subtracting the DP figures from the total
population. Thus the WP for Malta in 1976 was 160,100 whilst in 2006 it was 221,300. This
means that the DR for Malta in 1976was 144.9/160.1 = 0.9 or 10 persons of working age for every
nine dependents. In 2006 this changed to 172.6/221.3 = 0.8, ie. 10 persons of working age for
every eight dependents. This means that the burden on the working population has decreased
through a decrease in the birth rate. The family size has in fact decreased over these years from an
average of 5 or 6 persons per family to an average of 4 persons per family.
It is important, at this stage to clear up some misconceptions about the concept of the working
population. This term has already been defined and refers simply to AGE. Thus even if one is
under 16 years of age or over 60 years and is ‘gainfully occupied’ (works), he or she still forms
part of the dependent population since it is simply the age which counts in this concept. Also if
you’re 25 years of age and unemployed, you still form part of the working population since you
are above the MSLA and below the RA. The usual misunderstandings revolve around the concepts
of the Labour Supply (LS), the Gainfully Occupied (GO), the Unemployed (U) and the Inactive
Population (IP). These terms are defined below.
The Gainfully occupied population consists of those who have a job (employees and also self-
employed). A self-employed person is one who has his or her own business and thus ‘employs
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himself or herself’. The Unemployed consists of those who are seeking work. The Labour Supply
(or Labour Force) is made up of those who have a job and those who are seeking work. In
algebraic terms: LS = GO + U. When one hears that the unemployment rate is, say, 5%, this means
that out of every 100 persons in the Labour Force, (NOT in the working population) 5 persons are
seeking work and, by definition, the other 95 are gainfully occupied (have a job). Another
publication by the NSO, the Labour Force Survey, defines the term Inactive Population which
consists of “all persons (15 years and over) who are not classified as employed or unemployed.”
The Labour Force Survey for January to March 2006 shows that during that period, out of a total
population of 405,342, 37.3% were gainfully occupied, 3.2% were unemployed and 39.9% were
inactive with the remainder being children aged less than 15 years.

3.3 Optimum population

We sometimes refer to countries or regions as being overpopulated or underpopulated by referring
to population density. This is calculated by dividing the total population by the land area of the
country or region. Thus, for example, Malta’s land area is about 300 km2 and with a total
population of 407,810 in 2006, our population density is 407810/300 = 1,359 persons per km2.
This compares to Hong Kong’s 5,960 persons per km2, Singapore’s 4,667 persons per km2, Italy’s
194 persons per km2, Ireland’s 56 persons per km2, and so on. Malta is in fact the third most
densely populated country in the world. Does this mean that we are overpopulated and that Ireland,
for example, is underpopulated?
From the economist’s viewpoint, the terms underpopulated and overpopulated do NOT refer to
population densities but to the relationship between the number of people and the supplies not only
of land but also of capital and technical knowledge available to them. Economists define optimum
population as that size of population which, with the existing stock of land, capital, and
knowledge, would give rise to the maximum output per head. Thus the terms underpopulated and
overpopulated refer to sizes of population less than or greater than the optimum. This concept of
the optimum population cannot be fully explained at this stage since it depends upon what
economists call the ‘law of diminishing returns’, which will be explained in a later unit. It is
enough for now to know the definitions of optimum population, underpopulation and
overpopulation as well as the fact that these last two terms are NOT defined by population
densities.

3.4 Increasing Population and Ageing Population

An increasing population is one where the NGR is positive. It is also typified by the normal
population pyramid. The following are some economic problems that are faced by countries with
such a situation.
 A large increase in the numbers of young dependents can be a serious barrier to economic
growth. The economic resources needed to care for the growing numbers of children and to
educate them might have been devoted to industrial development and training.
 It is true that an increase in the number of children now, will bring about an increase in the
number of workers in the future BUT new workers need capital, even if it is only simple
tools. Many developing countries with rapidly growing populations find it very difficult to
carry out enough investment to maintain even the present very low ratio of capital to
workers.
 When a country is heavily dependent upon world trade for a major part of its requirements
of food and basic materials, a rapidly rising population might give rise to serious balance of
payments problems.
Although one might think that countries with an increasing population can only face
disadvantages, this is not completely true and some economic advantages do, in fact, exist.

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 An expanding population will create increased demands for goods and services, and
growing markets tend to stimulate investment and create employment.
 A growing population will be able to take more advantage of specialised production and
economies of scale.
 A country with a growing population and, hence, a young age structure will be more able
to change and better able to carry out that change. The labour force will be more mobile.
 A more rapid rate of technical progress is possible when the population is expanding
because new industries, new factories, and new techniques of production can come into
operation alongside the older ones.
An ageing population is one where the NGR is equal to zero. It is typified by the ageing
population pyramid. The following are some economic effects of this type of situation.
 An ageing population also means an ageing labour force, with more workers in their late
40s and 50s. Since older workers tend to be less adaptable than younger workers, the
economy may find it more difficult to cope with the adjustments required in order to make
rapid technical progress.
 As the population ages, firms will have to change their outputs to satisfy increasing
demands for the goods and services consumed by older people. There will also be
increasingly heavy demands on the health service and other social services.
 Many countries with an ageing population have the problem of financing a steadily
increasing bill for state retirement pensions. It is not only a fact that there are more people
over 60 but also that there are less people in the working population to contribute to a
pension fund.

3.5 Population distributions

The total population of a country may be analysed (categorised/classified) in various ways. One
way is according to age groups as was done in section 3.2 of this Unit. This is known as an Age
Distribution.
Another classification is that according to the occupation. This is known as the Occupational
distribution. Of course, this distribution concerns the gainfully occupied population, which in
2006 amounted to 151,379. 2.3% of these were employed in the primary sector, i.e. agriculture,
fishing and quarrying. Another 17.9% were employed in the Secondary sector. The rest (79.8%)
were employed in the Tertiary sector. In general this situation has been around for decades
although the percentage in the tertiary sector has been increasing steadily over the years whilst that
in the primary sector has been declining.
In analysing the occupational distribution of the population, one may also discuss the effects of
education on population statistics such as life expectancy. Thus, for example, the Demographic
Review for 2006 shows that out of 1,549 deaths in that year, 3% were over 65 and belonged to the
Senior Official and Professional classes. For other workers including unemployed this figure was
1.8%. However, 2.3% of deaths occurred to workers in the non-professional classes between the
ages of 45 and 64. This could mean that more education helps to increase life expectancy also
because more education usually brings its holder a higher salary with which one may buy more
medical services than the poorer classes.
Another possible classification is that of the Sex distribution or more properly the Gender
distribution of the population, which shows the numbers of males and females in the population.
This is shown in Table 3.1 with the gender also analysed according to age. From Table 3.1, it may
be seen that the Gender Ratio was 147:158 in 1976, i.e. 107 females for every 100 males. In 2006,
the equivalent ratio was 1 female to every 1 male. Of course, this ratio is not the same for each age
group. From Table 3.1, it may be seen that the number of males is higher than that of females for
all age groups up to the 50-54 age group. In the 60+ age group the ratio becomes 34:43 or 126
females for every 100 males. This shows that the life expectancy of females is higher than that for
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males. In fact according to the Demographic Review 2006 published by the NSO, the life
expectancy for females is 81.2 while that for males is 76.8.
A further classification is that according to the areas, towns or villages in the country. This is
referred to as the Geographical distribution of the population. This is usually used to distinguish
between the urban and the rural population. Thus, for example, we learn from an atlas that
Ireland’s urban population is 59% of its total population of 3.8 million, China’s is 21% whilst the
UK’s is 93%. By urban population is meant the number of people living in cities or towns. This
statistic is often used to show whether a country depends on the extractive sector or the other two
sectors for its living. On the whole, most people would agree that Malta’s population is 100%
urbanised nowadays and it is very rare to find someone living a lonely life far away from any other
settlement on these islands. Still, a look at the population of some towns and villages in Malta may
prove interesting. This may be seen at Table 3.2. It is obviously of major interest to such
institutions as Local Councils, Parishes, the District Police and other area-based organisations.
Locality Land area (km2) 1976 2006
B’Kara 2.815 17,427 21,658
Birzebbbugia 9.166 4,945 8,342
Bormla 0.854 9,092 5,562
Floriana 1.027 4,689 2,167
Gzira 1.017 9,753 6,681
Hamrun 1.068 13,651 9,379
Isla 0.155 4,653 3,002
Luqa 6.725 5,210 5,936
Marsa 2.689 9,086 5,228
Mosta 5.427 8,134 18,495
Msida 1.683 11,894 7,230
Paola 2.513 11,626 8,685
Qormi 5.013 15,019 16,459
Rabat 27.286 11,543 11,262
Rabat (Gozo) 2.898 5,027 6,248
San Giljan 1.622 7,944 7,057
Siggiewi 20.287 4,809 7,874
Sliema 1.296 20,052 11,890
Sta Venera 0.847 6,231 6,020
Tarxien 0.851 7,857 7,558
Valletta 0.841 14,071 6,166
Zabbar 5.757 10,000 14,671
Zebbug 8.677 8,046 11,228
Zejtun 5.367 9,932 11,306
Zurrieq 8.792 6,612 9,744
Source: Demographic Review, 1976, 2006 (NSO)
Table 3.2: Malta’s population in selected localities for 1976 & 2006
Official statistics divide the Maltese Islands into six (6) regions. These are:

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 Southern Harbour District which includes Valletta, Birgu, Isla, Bormla, Zabbar, Fgura,
Floriana, Kalkara, Luqa, Marsa, Paola, Sta Luċija, Tarxien, Xgħajra
 Northern Harbour District which includes Qormi, B’Kara, Gżira, Hamrun, Msida,
Pembroke, Pietà, San Giljan, San Ġwann, Santa Venera, Sliema, Swieqi, Ta’ Xbiex
 South Eastern District which includes Żejtun, Birżebbuġa, Gudja, Għaxaq, Kirkop,
Marsaskala, Marsaxlokk, Żurrieq;
 Western District which includes Mdina, Żebbbuġ, Siġġiewi, Attard, Balzan, Dingli, Iklin,
Lija, Rabat, Mtarfa;
 Northern District which includes Għargħur, Mellieħa, Mġarr, Mosta, Naxxar, San Pawl il-
Baħar;
 Gozo and Comino which includes all the localities in Gozo and Comino.
From Table 3.2, it may be seen that the 9 Southern harbour towns and cities for which there is data
in the table experienced a decrease in population of c.23% in 30 years. All of these towns and
cities registered a decrease in population except for Luqa (increase of 14% or 0.5% p.a.) and
Żabbar with an annual increase of 1.5% in the last 30 years or so. In particular, Marsa’s population
decreased by 42% while that of Valletta by 56% or 1.9% p.a. This means that nowadays Valletta’s
population is less than half what it was 30 years ago. The Northern Harbour district also
experienced a decrease in population. Collectively for the 8 towns and cities for which there is data
in the table, population decreased by 15,597 or 0.5% p.a. All of these towns and cities registered a
decrease in population except for Birkirkara (increase of 24% or 0.8% p.a.) and Qormi with an
annual increase of 0.3% in the last 30 years or so. In particular, Msida’s population decreased by
39% while that of Sliema by 40% or 1.4% p.a.
This decrease in population in the Inner and Outer harbour regions is counterbalanced by an
increase in the other areas of Malta such as Mosta where the size of population more than doubled
in the last 30 years (increase of 4.2% p.a.). Other increases were also registered in the South
Eastern district: Birżebbuġa (2.3% p.a.), Żejtun (0.5% p.a.) and Żurrieq (1.6% p.a.) and in the
Western district: Siġġiewi (2.1% p.a.) and Żebbuġ (1.3% p.a.).
As is the case with changes in the country’s population, changes in the size of the population in
various localities is due both to the Natural Growth Rate as well as to Migration. In this case,
though, this is internal migration, i.e. Maltese residents selling their property in places like
Valletta and Sliema and moving to places like Mosta, Birżebbuġa and Żebbuġ. This movement
could be due to various factors such as an increase in the value of property in localities such as
Valletta and Sliema. This increase could have been due to increased demand by commercial
entities such as firms in the tourism industry, retailers and so on. Social policy in this area is
affected by decisions regarding land use. Such decisions are partly made by free markets (see
Units 9 and 10) and partly by government, in the case of Malta through the Malta Environment
and Planning Authority (MEPA).

The Malta Environment & Planning Authority is committed to ensure that land use and the
protection of the environment meet the needs of today's society and future communities.
We are working to ensure a quality of life that will be in harmony with our natural,
cultural and built environment. In so doing we are seeking to implement sustainable
development that safeguard the environment. (www.mepa.org.mt)

Fig 3.3: Logo and aim of the Malta Environment and Planning Authority (MEPA)
Some final notes for this unit regards the terms demography and population census. Demography
is the study of population including total population and its various distributions. Demographers
(those who study populations) are also concerned with predicting population growth and sizes in
order to help societies (through their governments) plan for the future and present use of resources
especially the use of the non-replaceable resources mentioned in Unit 1. Thus the current
awareness of employing alternative energy sources. A population census is a numbering of the
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population of a country or region. A main purpose of a population census is to help plan for the
present and future population in the same way that demographers help societies in their use of
resources. In Malta, a population census must be carried out by law by the National Statistics
Office (NSO) once every ten years. The census also counts private dwellings and questions are
also asked on a range of subjects including age, sex, education, employment and household
facilities. The most recent census was held for the year 2005.

3.6 Summary of formulae used in this Unit

 Birth Rate (‰) = No. of Births X 1,000 / Total Population
 Death Rate (‰) = No. of Deaths X 1,000 / Total Population
 Immigration Rate (‰) = No. of Immigrants X 1,000 / Total Population
 Emigration Rate (‰) = No. of Emigrants X 1,000 / Total Population
 Natural Growth Rate = Birth Rate - Death Rate
 Migration Rate = Immigration Rate - Emigration Rate
 Rate of change of Total Population = Natural Growth Rate + Migration Rate = (Birth Rate
- Death Rate) + (Immigration Rate - Emigration Rate)
 Total Population = Working Population + Dependent Population
 Labour Supply = Gainfully Occupied + Unemployed
 Dependency Ratio = Dependent Population / Working Population
 Population density = Total Population / Land area in km2

Paul A. Borġ B.A. (Hons) Econ. Dip. Lab. Stud. , 2008

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