Dean Baker dismisses them

In fact, measured productivity numbers are unlikely to pick up the full gains that may be associated with lower populations. Large populations and crowding put enormous stress on the environment. Imagine having commuting times cut in half, if smaller populations eliminated rush-hour congestion. This would not be picked up in productivity measures.

Similarly, increased access to desirable locations, such as lower prices for waterfront property, would not be picked up by conventional measures of productivity. And, of course, the reduced pollution, including lower levels of greenhouse gas emissions, would also not be picked up in standard measures of productivity.

. . .

In short, there is no demographic problem facing wealthy countries. The only problem is that people with poor math skills and imperialistic designs hold positions of influence and power.

The problem of flat population growth is more serious than Dean imagines.

Folks concentrate on the problems associated with the Welfare States but ironically that is simply because the Welfare State has better accounting practices.

The core problem is that folks want to transfer good and services into the future. This is a fundamentally difficult thing to do.

However, one trick is to construct buildings and then to rent those buildings out to future generations. This is what the vast majority of the capital stock in America is devoted to.

However, in a world where population is declining this trick will no longer work.

What that means is that the real interest rate that establishes full employment can easily go negative in times of stress. This confuses policy makers who are so ingrained that savings ought to pay, because that’s how we get more wealth.

In truth savings can just as easily be a socially costly endeavor as a socially profitable one. There is nothing written into the laws of the universe that say it should be one way or the other.

Nor will productivity growth alone do it. Even in the best of times the productivity growth ‘spread” is small and can be overwhelmed by risk spreads, as no one actually knows ahead of time what investments will be complimentary to productivity growth.

The surer thing is per capita depreciation, since its much more likely that in the future people will continue to at least have some affinity for the things they wanted in the past. However, when the per capita part goes away all you have left is the depreciation part and for a huge portion of the capital stock, that rate is quite low.