The Next 200 Years and Beyond

 Within this study at the link below:

The Next 200 Years,

I envision what the World may look like over the next few centuries from a demographic and economic standpoint (looking both at respective growth and levels). 

If we look at a history of the World from such a perspective, our history is extremely simple.  You need to remember one single data: the onset of the Industrial Revolution at the beginning of the 1800s.

 Over the past 200 years, the World population has increased by 8 times, and the GDP per capita has increased close to 15 times.  Going forward over the next couple of centuries, these respective growth rates will certainly not replicate themselves. 

Looking out several centuries, our respective growth (in both economy and population) are likely to follow the pattern depicted in the graph below. 

From left to right, the graph starts with an S Curve beginning with the Industrial Revolution at the first inflection point of that S Curve.  Next, comes the extraordinary exponential growth over the next 200 years reaching out to the Present.  The latter is on the second inflection of that S Curve associated with a flattening of the mentioned growth.  Going out further to the right, we observe that growth has flattened.  And, it is soon sitting at the first inflection point near the top of a second and smaller inverted S Curve.  Following that curve, some of the growth rates mentioned may even turn negative.  World population is likely to decline and eventually stabilize past the second inflection of the inverted S Curve at some Equilibrium level.  Beyond that point, the respective growth rates (especially demographic growth) are likely to oscillate up and down around the Equilibrium level.  Mind you this process is likely to work itself out over several centuries.  

If you look at the present situation, there is already an abundance of evidence that the growth rates are flattening, if not even declining.  That is especially true for demographic growth.  The fertility rates in the vast majority of the developed World including China is already much below replacement rate (at around 2 children per woman).  Even within the least developed countries (LDCs) where fertility is relatively really high, it has plummeted within the past 60 years or so.  Within the next 100 years, even the LDCs fertility rates may be much below replacement levels.  Similarly, economic growth can't go on forever either.  And, economic growth in much of the developed World including China has slowed down over the past 60 years. 

This begs an interesting question.  What will the stock market be like in 500 years from now.  Over the long term the stock market growth is equal to: demographic + economic growth (per capita) + inflation + speculation.  But, in 500 years from now when we will likely have found an Equilibrium, the only factor left boosting the market will be speculation.  In essence, the stock market will become a Zero-sum game.  We will be betting on specific companies' stocks just like we are betting on a specific horse or basketball team within the sports gambling domain.  Such a stock market could remain viable.  After all, the gigantic derivatives market is very much a Zero-sum game too.